NVCA 2023 Yearbook - FINALFINAL

Y E ARBOOK
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Credits & Contact
National Venture Capital Association NVCA Board of Directors 2022-2023
(NVCA) EXECUTIVE COMMITTEE
Washington, DC | San Francisco, CA
nvca.org | nvca@nvca.org | 202-864-5920 EMILY MELTON Threshold Ventures, Chair
Venture Forward CHARLES HUDSON Precursor Ventures, Chair Elect
Washington, DC | San Francisco, CA VINEETA AGARWALA Andreessen Horowitz
ventureforward.org BYRON DEETER Bessemer Venture Partners

JILL JARRETT Benchmark, Treasurer
BOBBY FRANKLIN President & CEO
GREG SANDS Costanoa Ventures, Secretary
MARYAM HAQUE Executive Director, Venture
MOHAMAD MAKHZOUMI NEA, At-Large
Forward
PATRICIA NAKACHE Trinity Ventures, At-Large
JUSTIN FIELD Senior Vice President of
Government Affairs
AT-LARGE
SHILOH TILLEMANN-DICK Research Director
JASON VITA Vice President of Business
KRISTINA BUROW ARCH Venture Partners
Development
PETER CHUNG Summit Partners
MICHELE SOLOMON Senior Director of
DIANE DAYCH Granite Growth Health Partners
Administration
SCOTT DORSEY High Alpha
ROBIN CEPPOS Communications Manager
RYAN DRANT Questa Capital
CHARLOTTE SAVERCOOL Vice President of
BEEZER CLARKSON Sapphire Partners
Government Affairs
GAVIN CHRISTENSEN Kickstart Fund
RHIANON ANDERSON Senior Programs Director,
PATRICK ENRIGHT Longitude Capital
Venture Forward
HILARY GOSHER Insight Partners
KISME WILLIAMS Director of Operations
DAVID HALL Revolution
JONAS MURPHY Manager of Government Affairs
MAMOON HAMID Kleiner Perkins
SARAH MATTINA Marketing & Communications DANIEL LEVINE Accel
Director, Venture Forward KIRK NIELSEN Vensana Capital
JENNY ZEMEL Manager, Member Operations & CARMEN PALAFOX MiLA Capital
Experiences WILL PRICE Next Frontier Capital
SAVANNA MALONEY Communications RENATA QUINTINI Renegade Partners
Coordinator SCOTT RANEY Redpoint Ventures
GILLIAN CARNEY Public Policy Coordinator DANA SETTLE Greycroft
DON VIERA Sequoia
PitchBook Data, Inc. NICK WASHBURN Intel Capital
JOHN GABBERT Founder, CEO NNAMDI OKIKE 645 Ventures

DEENA SHAKIR Lux Capital
NIZ AR TARHUNI Vice President, Editorial &
STEVE SOCOLOF Tech Council Ventures
Institutional Research
ADAM VALKIN General Catalyst
DATA AND DESIGN
ALE X WARFEL Quantitative Research Analyst

TJ MEI Data Analyst
CAROLINE SUT TIE Design Manager
This publication has been created for the National Venture Capital Association by PitchBook Data, Inc. COPYRIGHT © 2023
by PitchBook Data, Inc. All rights reserved. No part of this publication may be reproduced in any form or by any means—
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systems—without the express written permission of PitchBook Data, Inc. Contents are based on information from sources
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an offer to buy any security. This material does not purport to contain all of the information that a prospective investor may
wish to consider and is not to be relied upon as such or used in substitution for the exercise of independent judgment.
Contents
Note from NVCA 4
Executive Summary 5-6
Venture Capital 101 7-12
At-a-Glance: The US Venture Industry 13-14
Capital Commitments: Venture Fundraising 15-19
Capital Deployed: Investment into Venture-Backed Companies 20-29
Exit Landscape: Venture-Backed IPOs & M&As 30-33
NVCA’s 2022 Year in Review 34-37
NVCA Public Policy Priorities 39-40
NVCA Member Community 41-42
NVCA Industry Partner Program 43
Venture Forward Highlights 44-45
Appendix 46-52
Data Methodology 53
Glossary 54-67
Geographic Definitions 68
Industry Code Definitions 69-76
3
N VC A 202 3 Y E A RBOOK
Data provided by
Note from NVCA

March 2023 already proving vital for everything from from imposing a stifling new regulatory
buttressing promising entrepreneurs regime on VC funds. If implemented, these
Dear Venture Capital Community: in need of support to investing in new mandates would have a depressive effect
companies active in the fields that make on the success of the companies that
I am writing to you shortly after our up the foundation of tomorrow’s economy. America needs to ensure its economic and
industry has faced its latest stress test. national security. NVCA is committed to
When the leaders of America’s fledgling Venture capital wasn’t the only part prioritizing the country’s well-being and is
venture capital sector founded NVCA 50 of the economy building for the future ready to litigate if the SEC places politics
years ago, they designed the organization last year. In 2022, Congress approved over national prosperity.
to serve as the voice of the US venture hundreds of billions of dollars to support
capital and startup community. Since the development of innovative industries The story of venture capital in 2021 was
then, we have been the key advocate for across the country. The recently written in the financial pages, with more
the innovation economy, translating the passed CHIPS and Science Act and capital invested in more companies than
needs of the public and private sectors the Inflation Reduction Act will make ever before. In 2022, headlines drove the
to ensure that the US remains the best historic investments into the research, market. By the end of the year, many of
country in the world for innovators to turn commercialization, and scaling of the rules that were previously etched in
their dreams into reality. The challenges advanced energy, computing, life sciences, stone had been wiped away. 2023 has
of maintaining our entrepreneurial and other technologies that are critical barely begun, and time isn’t slowing down.
ecosystem are constantly changing, to improving our national security and When tens of thousands of businesses in
and NVCA has been there for all of it. economic competitiveness. If realized in every state were worried about making
Informing our community, educating full, these efforts would go beyond just payroll, NVCA led the effort to educate
policymakers, and helping our economy commercializing early-stage technologies. those in power of the ramifications and
retain the vitality and dynamism that They are targeted at fundamentally offered paths to prevent them. Thankfully,
make it the envy of the world. redesigning the supply chains and the worst-case scenario was averted,
training the workforce required to bring and the livelihoods of many thousands of
VC is famous for its ability to adapt, them to strategic scale in America. At people were protected.
but few foresaw Russia’s invasion of NVCA, we will continue to engage on
Ukraine and the ensuing geopolitical the appropriation and implementation Venture capital is about progress, and the
retrenchment that turned out to be one of these programs and ensure NVCA path forward is as daunting as it has ever
of the major disruptions of 2022. This members are aware of opportunities been. The road ahead is going to require our
unprecedented challenge to the global resulting from these bills as soon as that community to be smarter, tougher, and more
economic order was a body blow to a information becomes available. resourceful as we seek to empower the
world recovering from the worst of the entrepreneurs who will change the world.
COVID-19 pandemic. It exacerbated a Despite making significant investments It’s an incredible challenge, but we’re up to it.
variety of issues including high inflation, in innovation in 2022, the government
rising interest rates, and an unstable labor also made choices that, if left unchecked,
market. This chaotic cocktail caused the would have suffocated it. NVCA had to
market to stumble in the second half of allocate significant time and resources to
the year. Deal counts dropped, and exits prevent a variety of counterproductive tax
were hit particularly hard, with public and regulatory threats from taking place
listings falling to the lowest level in years. in 2022. Key initiatives included curbing
While the drop in deals and exit activity attempts to tax unrealized capital gains,
is worrying, the industry was not without preventing increased taxes on carried
bright spots. Fundraising activity was interest, and maintaining the qualified
strong for the entire year, and the VC small business stock (QSBS) incentive.
Bobby Franklin
sector finished 2022 with record levels NVCA is currently working to stop the
President and CEO
of committed capital. This dry powder is Securities and Exchange Commission (SEC)
bfranklin@nvca.org
4
Data provided by
Executive Summary
VC Market activity in 2022 had two distinct phases. The first half of the year saw high levels of deal activity that approached the
records set in 2021. However, by the second half of the year, activity dropped by a significant margin. The mixture of new strategic
challenges abroad combined with the politics of pandemic recovery at home drove this decline. Fortunately, the public and private
sectors faced 2022’s challenges head-on. Investors and entrepreneurs stockpiled funds and cut costs, while policymakers outlined
ambitious programs to safeguard the nation’s economy. While the forces driving these market shifts have yet to recede or settle
into a predictable rhythm, NVCA will be closely following the implementation of new federal programs focused on the innovation
economy to assess their impact on investment trends.
Fund Activity
VC in 2022 started at almost the same level of activity as the end of 2021. Q1 2022’s 5,033 deals had a slightly lower median
valuation than 2021’s, but overall activity was robust. Furthermore, indices tracking the supply of capital showed that the supply
of available venture funding exceeded demand by a ratio of nearly 1.5 to 1. Q2 continued at the same pace as Q1, but the market
shifted in Q3, when the market entered a defensive crouch. Investors who began the year sitting on roughly a quarter of a trillion
dollars in dry powder fundraised aggressively to bolster their positions against an uncertain future. Deal counts decreased, deal
values increased, and valuations dropped. The trends of Q3 continued into the final quarter of the year. By the end of Q4, investors
sat on a combined $312 billion (nearly $1,000 for every American) of dry powder. First-time fundings were at multiyear lows, and
inside rounds were up. In a reversal from the beginning of the year, by the end of Q4, demand for venture funding outstripped
supply by over 2 to 1.
External Influences
Going into 2022, the country experienced significant inflation for the first time in decades. The Russia-Ukraine War restricted
exports from both nations. This forced Europe—which spent the last 30 years building its economy around cheap, reliable supplies
of gas from the Ural Mountains and Caspian Sea—to find alternative energy supplies, sending prices soaring. Meanwhile, tensions
on the other side of the world also rose. For 30 years, the United States and China fueled global growth, leveraging each other’s
strengths in a textbook example of comparative advantage. However, the Chinese government’s policy of trying to indigenize
multicountry supply chains for high-value goods, such as semiconductors, spurred considerable opposition from the legacy
producers it wanted to displace. Those producers, led by the United States, restricted Chinese access to the tools and materials
necessary to produce leading-edge semiconductors and other high-technology products. While this has negated China’s chances
to become an effective competitor in those industries, it also closed off the Chinese market for a wide variety of products. Without
access to these markets, America’s most innovative companies need to figure out how cope with the loss of roughly 1.5 billion
people from their total addressable markets.
Policy Responses
MONETARY POLICY: FEDERAL RESERVE ACTION
In the face of generationally high inflation, the Federal Reserve raised its benchmark interest rate by over 400 basis points between
April 2022 and January 2023; it currently sits at 4.33%. While the inflation rate has decreased, the current inflation rate of 6.25%
is well above the Fed’s target of 2%. Expected to continue further into 2023, these rate hikes represent a strong shift from the easy
money policies that have characterized the Federal Reserve’s policy since the 2008 financial crisis.
Note to readers: Figures for prior years throughout this edition of the Yearbook may be different from last year’s edition due to new and updated information.
5
Data provided by
FISCAL POLICY: FEDERAL GOVERNMENT ACTION
As the worst of the COVID-19 pandemic has hopefully abated, the federal government authorized significant funds across a variety
of programs to strengthen the nation’s entrepreneurial ecosystem. The CHIPS and Science Act and the IRA invest hundreds of
billions of dollars to support the next generation of American businesses across a variety of industries. The funds for most of these
programs still need to be appropriated in the 116th Congress. The fact that these laws have yet to be implemented hasn’t stopped
other countries from racing to implement similar initiatives. For example, the EU announced the European Technology Champions
Initiative, which allocates at least €10 billion for growth-stage investments in promising European tech companies across key
focus areas. While smaller in scope, the European program is already active and in search of promising companies to back. In
comparison, the US programs have yet to have funds appropriated or have most of their programs put into implementation.
Current State
American VC entered 2023 capitalized, consolidated, and cautious, with more money, fewer firms, and a demand for fresh capital
that exceeded the supply. Tensions in the sector were heightened in mid-March, when federal action was required to limit the
impacts brought about when two of the most active financial service providers for the startup ecosystem failed. For portfolio
companies, 2023 is a time to refocus on fundamentals and profitability. For investors, terms on new rounds are expected to become
increasingly favorable—a change from the operator-friendly terms that had normalized in recent years. However, the closed IPO
window remains a major concern across the sector. While there is broad agreement that M&A opportunities abound, the continued
inability of companies to go public drags significantly on the market. Raising new funds in 2023 isn’t expected to be easy. Rising
interest rates mean that asset allocators have a variety of attractive options to invest in, and fund managers need to prove that
they can provide exceptional value in a competitive financial landscape. Barring major shifts in current macroeconomic and
geopolitical conditions, the likelihood of returning to the status quo seems unlikely, and the full impacts of the institutional failures
of mid-March 2023 remain to be seen. However, there are opportunities for optimism. The relative strength of the VC community’s
financial position means that it is well-positioned to invest in potential opportunities. Furthermore, if the laws passed by Congress
are successfully funded and implemented, they will provided generational investments in critical industries across the country.
Shiloh Tillemann-Dick
Research Director
stillemanndick
@nvca.org
6
Data provided by
Venture Capital 101

Venture capital is a high-risk, high-reward Next, the 1990s became host to the first 3. Require five to eight years (or longer) to
asset class that supports entrepreneurs generation of major internet companies reach maturity
in their quest to turn ideas and basic like Alphabet (Google), eBay, and Yahoo!.
research into high-growth companies. The ensuing dot-com bubble led to a Venture funds usually make equity
Venture capitalists help companies frenzy of web-focused investment with investments in a company whose stock is
grow from individuals with ideas into capital commitments reaching an all- essentially illiquid until it matures, and the
organizations ready to change the world. time high before bursting in 2000. The VC fund exits its position. Generally, this
following recession resulted in a sharp takes at least five years, but eight or more
A Brief History of contraction of the VC industry. Facebook years is increasingly common.

(now Meta), Airbnb, Tesla, Dropbox, and
Venture Capital Uber were all founded less than one Venture funds find companies to invest in
decade after the dot-com bubble burst. through a variety of methods. Sometimes
Investments reminiscent of venture they pursue deals, while other times deals
capital have existed since at least the
1850s, when merchant-banking interests
The Details come to them. Once an investor finds a
promising company, they research the
in London and Paris syndicated with company to verify the legitimacy of its
INVESTING
their junior partners in New York to business model. This process, called due
help finance the development of the US diligence, is often handled in-house, but
Venture capital is a unique asset class.
railroad system. depending on the size of the investment,
With a few exceptions, companies funded
external consultants or investigators
by venture capital are new ideas that:
1. Cannot be financed with traditional

bank financing
2. Threaten established products and

services in their respective vertical
What Next?
Jay Cooke, widely regarded as (It’s a Cycle)
one of the fathers of American What’s Next? (It’s a Cycle)
Venture Capital.
Modern VC came into existence in

1974 when the Employee Retirement
Income Security Act (ERISA) instituted Return
the “Prudent Man Rule.”1 By utilizing Grow Fund
this standard, asset managers were Raise Fund Portfolio
Companies
able to assess asset risks in the context Deploy
of a portfolio rather than in isolation. Fund
This spurred the evolution of existing
investment firms into dedicated venture
firms. These venture firms invested in
the region’s nascent electronics and
pharmaceutical industries, helping turn
Source: NVCA 2023 Yearbook; Data provided by PitchBook
companies like Apple, Cisco, Compaq,
and Genentech into household names.
1: “Employee Retirement Income Security Act (ERISA),” U.S. Department of Labor, September 2, 1974. https://www.dol.gov/general/topic/retirement/
erisa#:~:text=The%20Employee%20Retirement%20Income%20Security,for%20individuals%20in%20these%20plans.
7
Data provided by
might be engaged. According to a 2016

study, How Do Venture Capitalists Make
leverage their expertise to provide value
to the entrepreneurs in their portfolio.
Average Frequency of
Decisions?, for every company that a Upon investing in a given company, Contact With Portfolio
venture firm eventually invests in, the investors provide company management Companies
firm considers roughly 100 potential with strategic and operational guidance.
opportunities.2 The same study showed They also connect entrepreneurs with
that the median venture firm closes about potential investors, customers, and
four deals per year. When evaluating employees. VC investors are vital partners
investments, venture investors consider to the companies they back, and daily
team, business model, product/market fit, interaction with the management team
and valuation, among other elements. is common. Any investor who has had
a “home-run” investment will tell you
Upon completion of due diligence, a fund that successful companies have active
might make a solo investment or pool its relationships with their investors and are
resources and syndicate its investment always trying to leverage every resource
with other VCs. Generally, the fund that to gain advantage over their competition.
performed the prospecting and due
Multiple times a week Every day
diligence on a given deal is identified as
Once a month Less than monthly
the syndicate lead, a title that generally
2-3 times a month Once a week
lacks any official benefits, but it grants the
lead investor industry prestige.
Venture differs from other forms of
financing because investors do not expect
to be paid back with interest. Rather,
they acquire a portion of a company at a
Common Strategies for Fund Deployment
given valuation. For example, $10 million
invested at a $100 million valuation
means that the investor acquires 10% of
the company.
As a company grows, it might require

Sector Strategy Stage Strategy
follow-on investments that provide
additional runway, thereby allowing the % of US Deal
Sectors Aspects of % of US
company to maximize its potential before Count 2021 Stages
Strategy Deals 2021
the investors exit their position. After Software 39%
several funding rounds with increasing
Pharma & Biotech 8% More Deals,
valuations, investors’ shares in the Early Stage
Fewer $ Per 70%
Other 4% (Angel-C)
company can decrease in value relative to Deal
Media 2%
new ones. This process is called dilution.
IT Hardware 3% Fewer Deals,
Nonequity funding instruments such Late Stage
More $ Per 30%
(D-Onward)
as loans are nondilutive, but are repaid HC Services & Systems 8% Deal
with interest. HC Devices & Supplies 5%
Energy 2% Source: NVCA 2023 Yearbook, Data provided by PitchBook

A VC investor’s competitive advantage
Consumer G&S 15%
is twofold. First, the investor needs to
Commercial G&S 14%
pick good companies to fund. Then, they
Transportation 1%
2: “How Do Venture Capitalists Make Decisions?” National Bureau of Economic Research, Paul Gompers, et al., September 2016. https://www.nber.org/system/files/
working_papers/w22587/w22587.pdf
8
Data provided by
Advice VCs Give US VC Exit Activity

Portfolio Companies $900 2,000
$800 1,800
Board Management 58%
$700 1,600
1,400
Personnel Guidance 46% $600
1,200
$500
Marketing Intros 69% 1,000
$400
800
Strategic Guidance 87% $300
600
$200 400
Operational Guidance 65%
$100 200
$0 0
Other 20%
2011
2006
2007
2008
2009
2010
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
0% 20% 40% 60% 80% 100%
Source: NVCA 2023 Yearbook; Data provided by PitchBook Exit value ($B) Exit count
FUND STRUCTURE Typical Distribution of

Profits Returned From a
While the organizational structures used
to create a VC fund are relatively common, VC Fund Primary Types
the way venture capital leverages those
structures is unique. First, the partners at a
of Exits
firm devise a thesis and a target size for the 20%
• Mergers and
fund. Then, the firm pitches asset allocators
like pension funds, insurance companies, Acquisitions
family offices, and nonprofit endowments
with the plan for the fund. Once the target • Public Listings
amount of committed capital ($40 million
was the median fund size in 2022) is met,
- IPOs
80%
they establish a limited partnership with the - Direct Listings
Raise a Fund
(Where does the C in VC come from?) - SPACs
Fund Manager
Who Invests in Venture
Who Invests in Venture Capital Investor
Capital Funds?
Funds? Source: NVCA 2023 Yearbook; Data provided by PitchBook
Potential Investors
Pension Funds
asset allocators as LPs and the firm itself investors in a venture fund profit only after
Nonprofit as the general partner. Capital is disbursed the company they invest in is acquired or
Endowments by LPs through capital calls, which are goes public. Although venture investors
legal rights of drawdown on an asset have high hopes for any company getting
Mutual Funds allocator’s capital, usually exercised on the funded, the 2016 study How Do Venture
identification of a new investment. Capitalists Make Decisions? found that, on
Family Offices average, 15% of a venture firm’s portfolio
For a typical investment, the VC will reserve exits are through IPOs, while about half are
three to four times the initial investment via M&A.3
Source: NVCA 2023 Yearbook; Data provided by PitchBook to budget for follow-on financing. The
3: “How Do Venture Capitalists Make Decisions?” National Bureau of Economic Research, Paul Gompers, et al., September 2016. https://www.nber.org/system/files/
working_papers/w22587/w22587.pdf
9
Data provided by
Venture Capital Creates More Jobs, Faster,
Than Any Other Sector
Venture Capital Creates More Jobs, Faster,
The Impact of Venture- EmploymentThan Any
Growth fromOther Sector
1990 to 2020
Backed Companies
Beyond Financial
Returns
The benefits of venture capital are not
limited to investors. A study by the Source: NVCA 2023 Yearbook; Data provided by PitchBook
Kauffman Foundation found that high-
growth startups, like those backed by Annualized Growth Rate of Employment from
VCs, accounted for as many as 50% of
gross jobs created annually between 1980
1990 to 2020
and 2010.4, 5
There is a stark contrast between the level

of job creation at VC-backedSource:
companies
Brown and Chow
versus non-VC-backed companies. NVCA, Venture Capital Invests in the Technologies Which
Venture Forward, and the Kenan Institute
Source: Brown and Chow
of Private Enterprise at University of North
Keep America Competitive
Carolina at Chapel Hill recently released a

report that found that employment at VC- Venture Capital Invests in the Technologies Which
Private Sector R&D American VC Investment
backed companies grew 960% from 1990
Keep America Competitive
to 2020, at a pace eight times higher than Spend 1975-2015 into Emerging Industries,
employment growth at non-VC-backed
companies.6 The research also found that
2020-2022
VC-backed jobs were resilient in economic
downturns: After the 2008 financial crisis
and during the Great Recession, annual -
job growth at VC-backed companies
exceeded 4.0%. By comparison, total
private sector employment shrank by
4.3% over the same period. And while
California, Massachusetts, and New York
have historically dominated VC activity,
Source:
Sources: Strebulaev & Gornall, NVCA
PitchBook 2023 Yearbook, Data provided by PitchBook
Data
62.5% of VC-backed jobs are outside
those states.7
backed. These 834 companies represent

The Economic Impact of Venture Capital:
Sources: Strebulaev &77%
Gornall, of theData
total market capitalization on
Evidence from Public Companies PitchBook
public markets, 92% of national research

analyzed the impact venture-backed Source: NVCA 2023 Yearbook; Data provided by PitchBook
and development expenditure, and 81%
companies had on the economy between
of total patents granted by the US Patent
1978 and 2020. The study found that of
8
and Trademark Office. 9

the 1,677 US companies that went public
in that period, 834 (or 50%) were venture-
4: “The Economic Impact of High-Growth Startups,” Kauffman Foundation, January 7, 2016. https://www.kauffman.org/-/media/kauffman_org/resources/2016/
entrepreneurship-policy-digest/pd_highgrowth060716.pdf
5: “The Role of Entrepreneurship in US Job Creation and Economic Dynamism,” Journal of Economic Perspectives, Ryan Decker, et al., 2014. https://www.aeaweb.org/
articles?id=10.1257/jep.28.3.3
6/7: “An Analysis of Employment Dynamics at Venture-Backed Companies Between 1990 and 2020,” University of North Carolina Kenan Institute of Private Enterprise
& Research, NVCA, Venture Forward, Gregory W. Brown, et al., February 2022. https://nvca.org/wp-content/uploads/2022/02/Employment-Dynamics-at-Venture-
Backed-Companies_FINAL.pdf
8/9: “The Economic Impact of Venture Capital: Evidence From Public Companies,” Social Science Research Network, Will Gornall and Ilya A. Strebulaev, July 8, 2021.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2681841
10
Data provided by
Active Investor Count in 2022 Deals by Company HQ State
157 9 -
35
11
3 22
45 9
5 14
12 49 78
307
15
6 40
815
128 33 41 7
35 42 66
121 160
7 14 3
1,735 11 63 24
44
12 34 72
44 8 2
7
1 9 76
273
18
2
241
1
Source: NVCA Venture Monitor, Data provided by PitchBook
By the end of 2022, VC-backed companies

accounted for the seven largest publicly
to include a greater diversity of people,
geographies, and disciplines. While most
Share of US VC Deal
traded companies by market capitalization VC investment continues to be directed to Value by Sector
in the US: Apple ($2.2 trillion), Microsoft the commercial hot spots of Boston, New in 2022
($1.9 trillion), Alphabet ($1.2 trillion), York City, and the Bay Area, 2022 saw
Amazon ($856.9 billion), Tesla ($389.0 deals close in every state, Puerto Rico, and 1.1%
billion), Meta ($315.6 billion), and NVIDIA the District of Columbia. Notably, Illinois
15.5%
($612.2 billion). saw the largest VC deal of 2022, and
North Carolina, Pennsylvania, and Texas
7.7%
Furthermore, recent research released by all ranked in the top 10.
37.4%
Silicon Valley Bank found that 42% of Food 2.5%
and Drug Administration (FDA)-approved SECTORSakouts in 2022 3.0%
US drugs between 2009 and 2018 9.2%
originated with venture capital funding.10 Historically, the dominant sector for
VC investment is software. In 2022, it 13.0% 5.9%
3.4%
Venture Capital Today accounted for roughly 40% of all deals 1.3%
nationwide. However, the breadth
Commercial Products Consumer Goods
of software as a category includes & Services & Services
OVERVIEW
everything from gaming companies to Energy HC Devices & Supplies
financial technology (fintech) to cloud HC Services & Systems IT Hardware
Modern venture capital is diversifying. An
computing, among others. It might be Media Other
industry that was once the purview of a
more helpful to visualize software as a Pharma & Biotech Software
small number of people in a few of the
category defined by its inputs, which are Transportation
nation’s commercial centers is expanding
the efforts of software engineers.
10: “Trends in Healthcare Investments and Exits 2019,” Silicon Valley Bank, 2019. https://www.svb.com/globalassets/library/managedassets/pdfs/healthcare-report-
2019-midyear.pdf
11
Data provided by
Software Company Consumer G&S Commercial P&S

Examples Company Examples Company Examples
Healthcare-related investment was the

second-largest category for VC investment
US VC Deal Activity by Stage
in 2022. It made up about 20% of all deals. $400 9,000
Healthcare-related investments include $350 8,000
three major sub-categories: biotech & 7,000
$300
pharma, healthcare services & systems,
6,000
and healthcare devices & supplies. While $250
these three categories contain numerous 5,000
$200
specialties, they are united by their 4,000
intended function, which is healthcare. $150
3,000
$100 2,000
The third- and fourth-largest categories
$50 1,000
fall under the goods & services category:
commercial products & services and $0 0
consumer goods & services. They 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
accounted for 15% and 14% of all deals Deal value ($B) Angel & seed Early VC Late VC Venture growth
in 2022, respectively. Their point of Source: NVCA 2023 Yearbook; Data provided by PitchBook
meaningful differentiation is the customer;
one category is consumer-facing, while
the other is focused on B2B transactions.
provide an easy shorthand for categorizing the later rounds generally categorized as
Combined, the software, healthcare, and them across a variety of sectors. growth rounds.
goods & services categories accounted
for 90% of deals in 2022. The next-largest STAGES In 2022, 39% of overall deals went to
category is “other,” at 5% of deals in 2022. angel or seed rounds, 30% went to
No other category accounted for more Venture investment’s relationship with early-stage rounds, 26% went to late-
than 3% of deals in 2022. enterprise maturity is broken out by stage rounds, and 5% of deals went to
stages (early and late stage) and then venture growth.
While there are almost as many ways into rounds. VC rounds range from angel
to categorize companies as there are or seed (the earliest), with later rounds For more information on US VC in
companies, this method is intended to identified by letters of the alphabet and 2022, please consult the appendices to
this report.
Learn more: If you’re interested in an introductory certificate course on VC, check out VC University ONLINE. A more detailed
history of VC is available here.
12
Data provided by
At-a-Glance: The
US Venture Industry
Overview VC AUM ($B)
$1,200
2022 was a tumultuous year in venture
capital. The first half of the year looked $1,000
like 2021, with deal counts and values
at or near all-time records. However, by $800
the close of the third quarter, a potent
mixture of rising geopolitical tension $600
and macroeconomic instability diffused
anxiety across VC and the entire US $400
economy. The second half of the year saw
$1,004.2
$1,115.7
a marked decrease in deal count, capital $200
$224.3
$224.4
$233.3
$253.2
$255.2
$277.8
$308.6
$337.4
$357.0
$378.9
$458.4
$544.8
$694.0
invested, and exits, especially IPOs. But
$0
the news was not all bad. Venture funds
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
hit a fundraising record in 2022, with the
industry sitting on a record $312 billion in
dry powder. Source: NVCA 2023 Yearbook; Data provided by PitchBook
US VC Deal Activity
Going Into 2022
$400 COVID-19 20,000
2021 was a record year for American $350 18,000
venture capital. While the possible 16,000

$300
sources of the market’s exuberance are 14,000
$250 12,000
too numerous to count, the results were
easier to quantify. 2021 ended with $345 $200 10,000
billion invested into 18,521 deals and $150 8,000
$753 billion across 1,925 total exits. The 6,000
$100
first half of 2022 proceeded at the same 4,000
$146.4
$149.3
$171.4
$345.4
$240.9
$37.1
$27.9
$32.4
$45.7
$41.7
$50.1
$73.8
$86.4
$84.0
$90.0
pace, with steady but cautious venture $50 2,000

activity in the first and second quarters $0 0
as investors looked toward a tightening
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
monetary environment.
Capital Invested ($B) Deal Count Company Count
Market Shifts Source: NVCA 2023 Yearbook; Data provided by PitchBook
Under ideal market conditions, investors

need a robust product/market fit, a
strong business model, and a capable
management team to make decisions.
However, 2022 brought new challenges.
13
Data provided by
The world reopened after the first

major pandemic in a century. The first
Capital Overhang ($B) by Vintage
European war of conquest in 75 years $300 Total
heightened anxiety across the globe. 2022*
The highest inflation in a generation hit $250
2021
consumers and impacted purchasing
$200 2020
power. And an increasingly aggressive
2019
China provided the United States with
$150 2018
an economic and political challenge not Overhang
seen since at least the turn of the century. by vintage 2017
$100
Combined, these conditions upset 2016
decades of market orthodoxy and offer $50 2015
Cumulative overhang
a bounty of perils and opportunities for 2014
enterprising investors. $0
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Coming Out Of 2022
While Q1 2022 mirrored the heights of

2021, Q4 2022 approximated the less invest, with 75% of that capital sitting in the failures of Signature Bank and
lofty days of 2018. Quarterly deal count funds of at least $250 million. Silicon Valley Bank were prevented by
and overall value counts fell to levels government intervention, the full impact
roughly commensurate with the late
2010s. Exits plunged to the lowest levels
Going Forward of the incidents is unclear. In the short
term though, these incidents have pushed
in over a decade, and public listings investors to question best practices that
Going into 2023, the US venture capital
slowed to almost nonexistent levels— many previously took for granted.
industry is capitalized, consolidated, and
just 14 occurred in Q4 and 76 over the
cautious. Some market watchers believe
entire year. While the drop in activity was 2023 is on track to be a year focused on
that the record levels of dry powder
worrisome, investors were quick to fortify efficiency and fundamentals. If the last
will surge forward and drive high levels
themselves against a tighter market with era of venture capital was exemplified by
of market activity. Early numbers from
aggressive fundraising. 2022 saw the unicorns, with their sky-high, occasionally
2023 indicate that investors are in no
most fundraising in modern VC history, ephemeral, valuations, the avatar of
rush to invest their capital. Instead, they
with nearly $163 billion raised across 784 the next era might be the mule: tough,
are making small numbers of high-
funds. When combined with overhanging efficient, and dependable.
value investments. Furthermore, while
funds from prior years, the industry has
the worst-case scenarios regarding
just under $315 billion in dry powder to
14
Data provided by
Capital Commitments:
Venture Fundraising
Overview US VC Fundraising Activity
$180 1,400
2022 was a record year for VC fundraising. 1,286
$160
America’s venture capital funds raised just 1,200
under $163 billion in 2022. When combined $140
869 1,000
with overhanging funds from prior years, $120
775 784
the US venture capital community is sitting 736
$100 800
638 652
on just under $315 billion of dry powder. 578
$80 490 600
However, investors do not seem to be in a
$60
rush to deploy those funds. As investment 312 338 400
activity decreased in the second half of $40 207 208
164 173
$155.2
$163.0
2022, investors raised funds to prepare 200
$29.5
$18.1
$16.2
$25.0
$23.4
$22.4
$37.1
$43.2
$51.0
$44.6
$60.4
$70.9
$89.4
$20
for opportunities rather than crises amid a 0
$0
changing market. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Capital Raised ($B) Fund Count

Consolidation Source: NVCA 2023 Yearbook; Data provided by PitchBook
2022 saw $163 billion raised among 784

funds. In comparison, 2021 saw $155 Share of Capital Raised by Manager Experience
billion raised among nearly twice as many
100%
funds. This concentrated more capital Experienced Firm
90%
among fewer managers, resulting in the Emerging Firm
80%
highest median fund size since 2010, when
the industry had roughly one-third as many 70%
active firms and AUM was almost 80% 60%
lower. Of the funds closed in 2022, 56% of 50%
the total capital went to just 35 funds—all 40%
with at least $1 billion in committed capital.
30%
Whether this trend continues into 2023
20%
remains to be seen.
10%
0%
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
15
Data provided by
Competition NTI and CVC Investor Count

25,000
2022 saw the steepest interest rate hikes
in a generation, which resulted in a more
20,000
challenging VC fundraising environment.
With higher interest rates, investors find
15,000
themselves in a much more crowded scrum
when pitching to limited partners. First-time
VC fundraising numbers could be an early 10,000
indicator of the competitive fundraising
landscape, with only 144 first-time managers 5,000
closing funds in 2022, the smallest number of
funds closed since 2013. 0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Other Points of Interest Total Unique Investors Unique NTI Count Unique CVC Investor Count

While the most salient questions about
fundraising are how much capital has been
raised and who raised it, there are a few
other points of concern about fundraising in
2022 and how the trends may impact the
FEDERAL FUNDS
Going Forward
year ahead.
The Policy Highlights section of this report
The fundamental questions about VC
details the variety of funds authorized in
NONTRADITIONAL INVESTORS AND fundraising remain how much money is
the last year. In many cases, these funds
CORPORATE VC being raised and who is raising it. If the
are nondilutive and have allocations/
trends of 2022 continue, there will be fewer
guidance prioritizing emerging managers.
NTIs and CVCs have increasingly valuable new investors on the market controlling
While many of these funds still need to
roles as part of the venture investing more capital. However, there has been a
be appropriated, prospective managers
community. However, if pressure on broad recognition across the public, private,
should pay close attention to how those
balance sheets increases, investors with and nonprofit sectors that new managers
programs develop.
greater optionality might reduce their from a variety of backgrounds and
participation in the market. geographies help maintain the vitality of
the VC community, and significant efforts
EMERGING ECOSYSTEMS are afoot to increase the opportunities for
new managers to enter the market.
Venture capital is famously concentrated
amid a few hot spots, but the last few years
have seen exciting growth in emerging
ecosystems across the country. For the
past five years, the South, mid-Atlantic,
and Mountain West have all grown at rates
above the national average.
16
Data provided by
10 Largest US VC Funds in 2022

Investor Name Fund Name Fund Size ($M) Close Date Fund State
Tiger Global Management Tiger Global Private Investment Partners XV $12,700.0 March 21, 2022 New York
Alpha Wave Global Alpha Wave Ventures II $10,000.0 January 25, 2022 New York
Andreessen Horowitz Andreessen Horowitz LSV Fund III $5,000.0 January 21, 2022 California
General Catalyst General Catalyst Group XI $4,600.0 March 11, 2022 Massachusetts
Andreessen Horowitz a16z crypto IV $4,500.0 May 25, 2022 California
Accel Accel Leaders IV $4,000.0 June 21, 2022 California
Bessemer Venture Partners Bessemer Venture Partners XII $3,850.0 September 9, 2022 New York
Founders Fund Founders Fund Growth II $3,431.1 March 4, 2022 California
Battery Ventures Battery Ventures XIV $3,080.6 July 14, 2022 Massachusetts
ARCH Venture Partners ARCH Venture Fund XII $2,975.0 June 29, 2022 Illinois
Top States by VC Raised in 2022

# of Funds VC Raised ($M) 2021-2022 YoY Change
California 306 $78,275.4 3.5%
New York 153 $45,349.8 42.1%
Massachusetts 62 $15,649.5 -0.5%
Illinois 25 $4,150.7 -33.1%
Florida 23 $2,613.4 139.7%
Texas 36 $2,419.5 -46.3%
Connecticut 10 $2,126.1 0.8%
Washington 11 $2,078.0 -8.9%
District of Columbia 8 $2,018.0 539.5%
Georgia 7 $1,180.5 -6.4%
17
Data provided by
VC Fundraising by State and Year ($M)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Alabama $36.6 - $21.9 - $25.6 - - - $5.0 -
Arizona - - - - $20.0 - - $300.0 $53.7 $104.5
Arkansas - - - - - - - - - -
California $9,385.4 $12,614.9 $13,539.9 $14,566.6 $14,441.9 $8,655.9 $7,384.0 $13,694.4 $11,441.9 $9,222.1
Colorado $87.0 $25.0 $52.3 $400.8 $132.6 $63.0 $253.0 - $266.9 $236.9
Connecticut $1,890.0 $510.0 $370.0 $45.0 $770.0 $25.0 $329.3 $180.0 $600.0 $193.1
Delaware - - $13.0 - - $100.0 $15.0 - $4.9 -
District of Columbia $400.1 - - $828.2 $380.0 - - $475.0 $68.4 $400.0
Florida $4.1 $693.0 - $448.5 $150.0 $145.6 $102.2 $223.1 $269.2 $47.9
Georgia $55.0 $83.6 $218.3 $175.0 $118.7 $55.0 $280.0 - $53.6 $143.7
Hawaii $7.9 $6.5 - - $1.8 - - - - -
Idaho - - - $76.4 $64.0 $51.9 - - $1.4 -
Illinois $13.0 $60.3 $418.1 $874.2 $764.6 $269.4 $578.6 $136.1 $203.3 $440.5
Indiana $65.0 $6.0 - - $24.2 $175.0 $0.5 $175.5 $19.0 $1.0
Iowa - - - $0.9 $3.5 - - - $3.0 $1.4
Kansas - - - - - - - $2.6 $0.0 -
Kentucky - $20.1 $36.4 - $175.0 - - $3.7 $7.0 -
Louisiana $220.7 $73.5 $70.0 $28.0 $60.0 $70.0 $56.0 - $6.0 -
Maine $160.0 - - $65.0 - - - - $10.1 -
Maryland $1,311.1 $35.8 $2,865.3 $575.0 $100.0 $2,566.8 $12.1 $6.0 $2,622.5 $736.2
Massachusetts $2,850.5 $3,315.3 $6,221.3 $5,546.2 $3,567.9 $3,098.4 $3,143.9 $3,427.0 $1,951.1 $5,012.1
Michigan - $178.7 $20.0 $13.0 - $246.2 $46.7 $292.6 $45.2 $83.7
Minnesota $49.8 $360.0 $398.0 $331.0 $486.4 $30.0 - - $150.8 $152.6
Missouri $119.8 - - $330.2 $100.0 $93.9 $20.6 - $23.0 $267.6
Montana - - $1.8 - - - - - - -
Nebraska - - - - - - $2.6 $37.3 - -
Nevada - - - - - - - - - -
New Hampshire - - $50.0 $12.0 - - - - - $21.0
New Jersey $212.9 $788.0 $1,063.0 $895.2 $41.6 $516.0 - $500.0 $349.0 $3.5
New Mexico - $47.5 $5.2 $2.4 - - - $10.0 - -
New York $892.3 $1,768.4 $3,332.7 $4,297.7 $2,589.8 $1,139.6 $2,657.9 $4,666.3 $3,440.0 $2,201.7
North Carolina $33.3 $226.0 $340.0 $28.0 $83.0 $102.0 - $15.0 $25.3 $215.0
North Dakota - - - - - - - - - -
Ohio $254.8 $19.4 $101.5 $260.9 $275.6 $25.0 $92.9 $34.2 $184.1 $61.1
Oklahoma - - - $10.5 - - - - $10.0 -
Oregon - - - $0.9 $12.6 $3.0 $20.4 $4.6 $14.1 $105.8
Pennsylvania $447.6 $134.9 $392.6 $194.0 $728.6 $391.4 $144.9 $103.9 $730.1 $254.8
Rhode Island - - - - - - - - $1.1 -
South Carolina - $10.0 - - - - - - - $18.8
South Dakota - $10.0 - - $32.5 - - $16.0 $0.7 -
Tennessee $50.0 $12.3 $54.0 $54.7 $83.9 $14.0 $74.2 $47.4 $2.5 $128.4
Texas $760.7 $176.2 $1,264.8 $103.3 $825.8 $22.1 $125.6 $519.1 $155.4 $1,315.4
Utah $85.0 $12.1 $128.3 $326.0 $100.0 $127.2 $66.4 $33.0 $38.2 $270.7
Vermont $1.5 - - - $14.0 - - - $80.0 -
Virginia $153.4 $616.5 $478.0 $296.0 $224.1 $124.0 $597.3 $1.1 $133.9 $191.4
Washington $700.5 $709.3 $431.0 $2,400.5 $2,995.8 $2.5 $5.9 - $328.2 $574.2
Wisconsin $10.7 - $171.5 - $57.0 - $200.3 $47.9 $112.5 $6.6
Wyoming
Source: NVCA 2023 Yearbook; Data provided by PitchBook | *For this table, we give precedent to the fund location, but if unavailable, we use the HQ location of the firm.
18
Data provided by
VC Fundraising by State and Year ($M), continued

2014 2015 2016 2017 2018 2019 2020 2021 2022
Alabama - $41.8 - $1.4 $25.0 - $91.9 - $11.7
Arizona $156.9 $4.8 $24.8 $29.4 $5.6 $108.6 - $181.4 $140.7
Arkansas $10.5 $0.3 $151.5 - $0.1 - $1.5 - -
California $20,996.3 $22,038.6 $32,214.0 $25,766.5 $31,623.7 $45,960.4 $45,217.8 $75,632.6 $78,275.4
Colorado $523.9 $500.6 $109.9 $235.1 $1,241.8 $281.7 $537.3 $716.6 $1,077.7
Connecticut $516.4 $132.8 $357.4 $655.9 $433.2 $863.2 $1,243.0 $2,109.3 $2,126.1
Delaware $10.0 $2.4 $15.5 - - $71.7 - - $1.5
District of Columbia $3.3 $88.5 $840.3 $491.4 $74.2 $657.9 $1,378.6 $315.6 $2,018.0
Florida $381.3 $242.8 $86.4 $64.9 $316.4 $731.9 $1,342.6 $1,090.4 $2,613.4
Georgia $67.0 $165.5 $79.0 $122.0 $71.3 $1,112.3 $198.3 $1,261.1 $1,180.5
Hawaii $10.0 - - $3.0 - - - $6.3 -
Idaho $1.2 - $1.3 $15.0 - $50.0 - - $6.9
Illinois $1,119.9 $387.3 $1,275.6 $1,835.7 $1,005.2 $1,183.2 $2,260.7 $6,207.2 $4,150.7
Indiana $2.5 $15.4 - $15.5 $137.6 $0.7 $6.0 $315.1 $59.9
Iowa $1.8 - $48.3 $0.4 $11.2 $100.4 $41.6 $279.7 -
Kansas - - $0.2 $26.4 $42.7 $27.2 $67.5 $40.0 -
Kentucky - $7.5 - - $25.5 - $37.0 $1.4 -
Louisiana - $11.9 - - $6.0 $6.0 - - $10.3
Maine - $123.0 - $10.2 - - $2.4 - $21.5
Maryland $1,179.5 $3,451.1 $10.0 $123.7 $97.3 $232.3 $336.7 $1,160.0 $180.6
Massachusetts $2,507.4 $4,942.2 $6,181.2 $7,343.4 $5,454.3 $7,109.4 $11,260.2 $15,728.2 $15,649.5
Michigan $95.0 $306.6 $1,222.6 $226.1 $49.0 $374.1 $500.5 $140.2 $25.0
Minnesota $15.6 $108.0 $3.1 $155.6 $153.2 $117.7 $383.5 $1,256.1 $69.0
Missouri - $130.0 $375.0 $164.2 $243.4 $91.3 $127.6 $687.8 $50.0
Montana - - $21.1 $2.8 $38.0 $25.0 - $330.0 -
Nebraska - $19.8 $2.0 $31.0 - - - $35.3 -
Nevada - $42.6 - $5.0 - - $5.0 $6.6 $150.0
New Hampshire $0.9 $7.5 $8.3 $49.1 $172.0 $256.1 $186.6 $1,043.9 $91.4
New Jersey $33.5 $8.5 $591.1 $10.0 $84.3 $425.7 $84.9 $307.1 $89.8
New Mexico $8.7 - $9.8 $2.7 - $2.0 - $7.0 -
New York $7,307.3 $7,335.5 $4,092.3 $3,366.5 $11,971.5 $6,740.6 $16,147.2 $31,921.9 $45,349.8
North Carolina $38.1 $35.0 $209.4 $160.8 $66.1 $132.5 $243.5 $1,003.2 $998.4
North Dakota $3.5 - - $1.8 - - - - -
Ohio $375.3 $36.6 $504.4 $29.7 $176.3 $399.1 $607.1 $440.5 $206.2
Oklahoma $1.0 $13.2 - - - - $13.9 $20.0 -
Oregon $35.6 $18.3 $28.6 $42.7 $66.0 $42.6 $46.8 $136.7 $13.0
Pennsylvania $236.8 $377.2 $55.9 $132.0 $89.9 $440.7 $522.3 $105.5 $466.1
Rhode Island - $0.4 - - - - - $100.0 -
South Carolina $7.4 $8.0 $6.0 $9.0 $5.0 $5.0 $8.3 $5.0 $205.0
South Dakota - - - - - - - - -
Tennessee $22.5 $0.3 $303.5 $125.4 $196.4 $170.0 $347.6 $193.2 $964.2
Texas $575.5 $227.7 $806.7 $1,937.5 $1,878.1 $1,309.3 $1,099.4 $4,502.0 $2,419.5
Utah $154.4 $326.6 $222.4 $137.8 $224.0 $206.9 $631.5 $877.4 $590.5
Vermont $12.0 - - $71.3 - $11.7 - - $18.5
Virginia $317.0 $803.6 $716.1 $309.2 $1,218.5 $515.5 $748.7 $2,718.7 $592.6
Washington $340.8 $1,195.9 $451.4 $703.0 $3,066.7 $733.0 $3,246.6 $2,280.3 $2,078.0
Wisconsin $33.2 $25.9 $11.4 $134.5 $178.4 $252.0 $27.4 $381.8 $66.1
Wyoming
Source: NVCA 2023 Yearbook; Data provided by PitchBook | *For this table, we give precedent to the fund location, but if unavailable, we use the HQ location of the firm.
19
Data provided by
Capital Deployed:
Investment into
Companies
Overview US VC Deal Value ($B) by First-time vs. Follow-on
$400
Venture capital investments in
$350
2022 largely mirrored the country’s
macroeconomic environment. The first $300
half of the year saw roughly $155 billion
$250
of deal activity across the United States,
while deal activity in the second half of $200
the year decreased to approximately $150

$84 billion. While numerous events may
$100
have contributed to the drop in activity,
the Fed’s benchmark interest rate hikes $50
are the most proximate cause for the $0
decrease in VC activity. The benchmark 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
rate increased by 155 basis points—from First Follow-On
0.33% to 1.68%—between Q2 and Q3.
It continued to increase until it was more Source: NVCA 2023 Yearbook; Data provided by PitchBook
than 4.1% by the year’s end.
While 2022 saw precipitous quarterly

across a wider range of sectors and
geographies. The energy, commercial
Stages
reductions in industry activity, the $238
goods, healthcare services, biotech &
billion of full-year deal value was the The relative decline of angel and seed
pharma, and software sectors all saw the
second highest for overall VC investment deals stood out as one of the most
year end with levels at or near the highs
on record. Compared with previous interesting trends in 2022. Over the
of 2021.
years, more investors made larger deals course of 2020 and 2021, angel and
seed stages made up roughly 45% of
US VC Deal Count by Stage

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Angel & seed 3,385 4,582 5,220 5,802 5,148 5,414 5,538 6,012 5,964 7,736 6,536
Early VC 2,752 3,282 3,421 3,531 3,217 3,576 3,665 3,798 3,515 5,366 4,887
Late VC 1,525 1,680 1,899 2,025 1,979 2,210 2,592 3,022 3,139 4,507 4,181
Venture Growth 430 491 543 512 483 530 613 679 733 1,003 828
20
Data provided by
VC deals (in prior years, the percentage

went even higher), with early- and
the largest absolute growth (12% to
16% of all capital invested) and energy
Nontraditional Investors
late-stage VC making up the balance. increasing the most in relative terms (1% and CVCs
However, by the end of 2022, angel- and to 2%).
seed-stage investments made up just Over the last few years, nontraditional
38.5% of investments, far below the
Geographies investors have dramatically increased
their participation in the venture capital
annual average of 41.3%. In comparison,
early-stage deals ended the year at ecosystem. As of 2022, NTIs or CVCs
Venture capital remains concentrated
33.4% of deals, significantly above the participated in nearly half of the deals
around a few major hot spots, with
stage’s annual average of 31.8% and 4% in the United States, operating across
roughly 60% of 2022’s deals occurring
higher than the average for 2020 and a variety of stages and sectors. CVCs
in five states (California, Massachusetts,
2021. Late-stage VC realized a similar and NTIs backed some of the most
New York, Texas, and Florida). However,
rate of relative growth, ending the year interesting companies of 2022 in sectors
the story of the past few years has been
at 28.1% of all deals, compared with including AI, aerospace, and climate
one of increasing diffusion across the
a 26.9% annual average in 2022 and tech, among others. Will nontraditional
country. Since 2018, the West Coast and
25.2% average in 2020 to 2021. While a investors and CVCs continue to expand
Northeast have seen relative decreases
variety of factors could be driving these their participation in venture in a world of
in investment levels, while regions
figures, they lend credence to reports of higher interest rates and more pressure
such as the Intermountain West and
increased prevalence of inside rounds on corporate balance sheets? This
Southeast have seen relative increases
amid a tense market. remains to be seen.
in investment levels. Some of the most
interesting developments have been
Sectors regional hot spots, including fintech and Going Forward
artificial intelligence (AI) in Austin, Texas;
Software continues to dominate the VC healthtech in Washington, DC; advanced 2022 began with the same exuberance
sector, making up roughly 37% of all energy/deep tech in Denver, Colorado; seen throughout 2021. By the second
venture capital invested in 2022, which and biotech in the Research Triangle of half of the year, inflation and geopolitics
is consistent with the prior two years. As North Carolina. Venture investments slowed the pace of investment and
a share of total capital invested, activity have increased in almost every state over placed the VC ecosystem on a more
remained relatively flat across all sectors, the past five years. A recent proliferation deliberative path going into 2023.
with commercial goods & services seeing of public/private sector collaborations
aimed at increasing this trend could
safeguard this growth in the face of a
less stable market.
2022 US VC Deal Value ($B) by Sector

Commercial Products & Services $37.2 Media $3.2
Consumer Goods & Services $18.6 Other* $14.1
Energy $5.9 Pharma & Biotech $31.3
HC Devices & Supplies $7.3 Software $90.2
HC Services & Systems $22.1 Transportation $2.7
IT Hardware $8.2 Source: NVCA 2023 Yearbook; Data provided by PitchBook
* Other industry groups:
• Commercial Products • Other Consumer Products and Services • Other Financial Services • Construction (Nonwood)
• Commercial Transportation • Utilities • Other Healthcare • Containers and Packaging
• Other Business Products and Services • Other Energy • IT Services • Forestry
• Consumer Durables • Capital Markets/Institutions • Other Information Technology • Metals, Minerals, and Mining
• Consumer Nondurables • Commercial Banks • Agriculture • Textiles
• Services (Nonfinancial) • Insurance • Chemicals and Gases • Other Materials
21
Data provided by
A FEW KEY QUESTIONS GOING an increase of inside rounds intended to was less than one. This flip in supply
INTO 2023: provide runway for portfolio companies. versus demand lends credibility to
An uncertain market combined with reports of increasingly investor-friendly
How is the industry going to deploy its reduced access to the public markets terms across the ecosystem. When
record levels of dry powder? could mean that significant amounts of combined with the downward pressure
capital continue to go to existing portfolio on valuations, it looks like term sheets
Between the record levels of fundraising companies until the market stabilizes. in 2023 might be more investor-friendly
in 2022 and vast amounts of overhanging than in recent years.
funding from prior years, American What is the impact of the government
venture capital is sitting on over $300 funding authorized in 2022 going to be? Overall, the story of capital deployment
billion of undeployed capital. The timing in 2022 is one of exuberance tempered
and volume of disbursement could have From 2021 to 2022, Congress approved by caution after some radical shifts to
a significant impact on the industry legislation to invest hundreds of billions the status quo. The extent to which that
over the coming months. Some market of dollars in projects like semiconductor trend will continue into 2023 remains to
observers believe that this stockpile manufacturing to infrastructure to be seen.
will keep the market going at current fostering regional tech commercialization
volumes, but early numbers in 2023 hubs across the country. Many of these
seem to indicate that investors are taking programs are either targeted at or
their time in 2023 and making fewer, accessible to the venture industry and
larger investments. offer significant quantities of patient
capital. The wrinkle is that most of the
Is 2023 going to be the year of the funds need to be authorized by the
inside round? current Congress, and the shape of that
language remains a primary concern for
The gradual drop in angel and the VC community.
seed rounds in 2022, followed by a
commensurate increase in early-stage What impact will valuations have on
rounds, begs the question: Where is that first-time fundraising by founders?
money going? Most of 2022’s fundraising
went to existing managers insulating In 2021, there were almost three dollars
themselves against market shifts. The of VC funding available for each dollar
proliferation of non-angel- or seed-stage of demand. By the end of 2022, there
deals in the second half of 2022 indicates
22
Data provided by
US VC Deal Activity by State in 2022

Company # of Deals Capital Company # of Deals Capital
Count Closed Invested ($M) Count Closed Invested ($M)
California 4,956 5274 $104,020.7 Missouri 89 93 $780.5
New York 2,048 2174 $29,238.6 South Carolina 52 57 $672.0
Massachusetts 928 998 $21,354.3 Wyoming 42 46 $662.5
Illinois 398 424 $10,447.6 Vermont 38 43 $583.9
Texas 804 877 $10,261.0 Wisconsin 91 97 $547.2
Washington 507 552 $8,170.7 Nebraska 42 43 $491.6
Florida 639 691 $7,238.6 Kansas 36 41 $361.2
Colorado 418 452 $5,837.4 Idaho 39 41 $324.9
Pennsylvania 352 392 $4,684.1 Iowa 49 53 $288.7
North Carolina 289 306 $4,406.9 Alabama 46 48 $265.6
Virginia 249 266 $3,103.9 Arkansas 33 33 $235.5
Utah 188 199 $2,544.1 Oklahoma 28 30 $225.1
New Jersey 232 252 $2,342.5 New Hampshire 44 47 $211.7
Minnesota 165 179 $2,266.9 Montana 30 31 $198.5
Georgia 273 295 $2,254.4 Rhode Island 34 36 $179.4
Ohio 186 197 $2,164.3 Louisiana 41 42 $173.4
Delaware 414 446 $1,988.2 New Mexico 28 29 $143.2
Connecticut 158 172 $1,859.5 Maine 31 31 $93.9
Maryland 190 200 $1,581.8 Kentucky 63 64 $86.1
District of Columbia 106 111 $1,421.9 North Dakota 7 8 $75.0
Nevada 109 120 $1,313.0 Alaska 12 12 $69.2
Arizona 149 164 $1,274.4 Mississippi 11 13 $67.8
Michigan 166 176 $1,206.2 Hawaii 18 21 $54.9
Oregon 153 169 $986.9 West Virginia 8 8 $9.8
Tennessee 141 148 $976.9 South Dakota 2 3 $6.2
Indiana 169 176 $786.9 Source: NVCA 2023 Yearbook; Data provided by PitchBook
Top 10 US VC Deals in 2022

Company Name Close Date Deal Size ($M) Deal Type Industry Sector State
VillageMD April 1, 2022 $5,200.0 Late-stage VC Healthcare Illinois
Altos Labs January 20, 2022 $3,000.0 Early-state VC Healthcare California
Epic Games April 11, 2022 $2,000.0 Late-stage VC IT North Carolina
SpaceX June 30, 2022 $1,725.0 Late-stage VC B2B California
Gopuff May 18, 2022 $1,500.0 Late-stage VC B2C Pennsylvania
Anduril December 2, 2022 $1,480.0 Late-stage VC B2B California
Securonix April 28, 2022 $1,163.1 Late-stage VC IT Texas
TeraWatt Infrastructure September 13, 2022 $1,000.0 Early-state VC B2B California
Flexport March 28, 2022 $935.0 Late-stage VC IT California
TerraPower November 3, 2022 $830.0 Late-stage VC Energy Washington
23
Data provided by
2022 VC Deals & Company Counts by # of States Invested Into by Investor

State HQ State
Company % of Total Capital % of # of States # of States
Count Invested ($M) Total Investor HQ State Invested Investor HQ State Invested
In In
California 4,956 32.2% $104,020.7 43.2%
California 50 Arizona 25
New York 2,048 13.3% $29,238.6 12.1%
New York 48 Delaware 25
Massachusetts 928 6.0% $21,354.3 8.9%
Texas 48 Kentucky 25
Illinois 398 2.6% $10,447.6 4.3%
Massachusetts 44 Louisiana 24
Texas 804 5.2% $10,261.0 4.3%
Illinois 44 Oregon 24
Washington 507 3.3% $8,170.7 3.4%
Florida 44 Iowa 21
Florida 639 4.2% $7,238.6 3.0%
Colorado 40 Nevada 21
Colorado 418 2.7% $5,837.4 2.4%
Maryland 38 Nebraska 20
Pennsylvania 352 2.3% $4,684.1 1.9%
District of Columbia 37 South Carolina 20
North Carolina 289 1.9% $4,406.9 1.8%
Georgia 37 Alabama 16
All Others 4,040 26.3% $35,271.3 14.6%
Washington 36 Idaho 15
Total 15,379 $240,931.3
Utah 35 Wyoming 15
Source: NVCA 2023 Yearbook, Data provided by PitchBook
Missouri 34 Arkansas 14
Top 5 States by Percentage of 2022 New Jersey 33 Montana 14
Deals Done in State That Featured

Minnesota 33 New Mexico 13
Ohio 32 Oklahoma 13
Investor(s) From Outside State Tennessee 31 Puerto Rico 12
Company HQ State % Invested From Outside State Wisconsin 31 Rhode Island 10
Delaware 88.4% Vermont 30 South Dakota 9
Wyoming 87.5% Pennsylvania 30 Hawaii 6
New Hampshire 71.4% North Carolina 29 Maine 5
New Jersey 66.7% Virginia 29 West Virginia 4
Nevada 60.0% Connecticut 29 Virgin Islands 4
Source: NVCA 2023 Yearbook, Data provided by PitchBook Indiana 27 Alaska 4

*This ranking includes states with 20 or more investments.
New Hampshire 27 North Dakota 3
Example of how to read this table: 88.4% of deals done with Delaware-based companies
included investors from outside the state. Michigan 27 Mississippi 3
Kansas 26
Top 5 States by Percentage of 2022 Source: NVCA 2023 Yearbook, Data provided by PitchBook
Deals Done in State That Featured

Investor(s) From That State
# of States California Investors
Company HQ State % Invested From Within State
Invested Into by Year
California 88.5%
Year # of States Invested In
New York 77.9%
2007 40
Massachusetts 70.8%
2013 46
Texas 57.7%
2022 50
Illinois 74.1%
*This ranking includes states with 20 or more investments.
Example of how to read this table: 88.5% of investments in California-based companies
featured at least one California-based investor.
24
Data provided by
First-time Financings
US VC Deal Value ($B) by First-time vs. Follow-on US VC Deal Activity by
$400 Sector: First-Round VC
$350 in 2022
$300
Sector # of Deals Capital
Closed Raised ($M)
$250
$200 Commercial
Products & 824 $2,583.4
$150 Services
$100 Consumer
Goods & 662 $1,792.9
$50 Services
$0 Energy 52 $1,122.5
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
First Follow-On
HC Devices &
93 $548.9
Supplies
HC Services &
334 $1,504.4
Systems
US VC Deal Count by First-time vs. Follow-on
18,000 IT Hardware 82 $528.9
16,000
14,000 Media 185 $373.0
12,000
10,000 Other 283 $2,503.8
8,000
Pharma &
6,000 260 $3,855.9
Biotech
4,000
2,000 Software 2,027 $8,653.2
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Transportation 41 $232.8
First Follow-On
25
Data provided by
Life Sciences
US Life Sciences VC Deal Activity
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Capital Invested ($B) $8.4 $9.4 $9.5 $11.4 $14.3 $16.5 $15.6 $20.6 $29.0 $27.1 $40.6 $54.7 $43.0
# of Deals Closed 1,057 1,178 1,206 1,368 1,460 1,593 1,544 1,771 1,889 2,008 2,146 2,605 2,082
Company Count 975 1,092 1,114 1,278 1,368 1,482 1,477 1,674 1,775 1,878 2,010 2,381 1,925
US Life Sciences VC Invested ($M) by Select Sectors

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Biotechnology $2,076.8 $1,628.8 $1,761.4 $1,773.1 $2,827.2 $3,954.5 $3,493.4 $4,797.5 $5,602.9 $4,476.9 $7,460.1 $9,655.0 $10,830.4
Diagnostic
$723.3 $773.7 $615.9 $988.0 $888.5 $1,230.5 $915.2 $1,528.3 $1,526.0 $1,477.8 $2,565.4 $3,176.9 $2,052.3
Equipment
Discovery Tools
$47.5 $100.7 $23.7 $73.0 $107.7 $159.4 $138.9 $156.4 $487.3 $291.9 $588.4 $1,482.2 $951.2
(Healthcare)
Drug Delivery $149.2 $495.6 $620.9 $487.6 $569.7 $468.0 $814.4 $1,166.1 $565.1 $435.8 $840.8 $1,081.3 $1,332.0
Drug Discovery $1,569.3 $1,990.1 $2,249.7 $3,405.1 $4,098.0 $5,634.5 $4,948.2 $6,386.6 $12,084.9 $11,451.6 $18,415.1 $24,866.5 $16,567.1
Medical Supplies $109.3 $67.2 $113.9 $175.1 $725.1 $38.6 $62.8 $64.7 $92.7 $134.5 $125.4 $266.0 $245.6
Monitoring
$172.1 $189.2 $375.4 $348.7 $607.1 $415.5 $565.5 $520.1 $899.8 $920.0 $812.0 $961.0 $1,158.8
Equipment
Other Devices and

$495.9 $231.2 $628.7 $442.0 $460.1 $557.4 $525.6 $1,021.2 $858.0 $434.9 $968.3 $723.8 $534.1
Supplies
Other
Pharmaceuticals $73.2 $69.1 $38.7 $29.2 $103.7 $108.7 $69.9 $102.1 $533.4 $335.7 $473.8 $488.6 $218.1
and Biotechnology
Pharmaceuticals $936.4 $871.3 $605.7 $624.4 $617.4 $647.7 $783.1 $594.2 $1,045.3 $1,471.0 $1,818.7 $1,254.1 $1,398.3
Surgical Devices $886.1 $1,018.4 $872.3 $811.6 $1,156.3 $789.8 $700.6 $783.9 $911.3 $1,231.2 $1,065.4 $1,371.1 $1,101.8
Therapeutic Devices $805.0 $1,292.3 $819.4 $1,074.8 $989.2 $1,397.8 $1,019.9 $1,462.4 $1,563.6 $1,425.3 $2,155.1 $2,509.0 $2,221.8
26
Data provided by
US Life Sciences VC Deal Count by Select Sectors

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Biotechnology 181 176 215 235 259 269 263 294 283 270 328 414 387
Diagnostic
118 134 131 141 137 146 151 161 167 170 189 218 159
Equipment
Discovery Tools
13 17 16 17 27 25 25 28 36 31 45 64 44
(Healthcare)
Drug Delivery 22 32 32 37 33 33 31 50 44 48 57 78 45
Drug Discovery 194 198 204 261 287 343 333 434 488 553 608 742 528
Medical Supplies 29 23 28 37 27 24 23 26 26 28 38 42 36
Monitoring
38 54 66 81 86 99 115 117 119 121 130 152 125
Equipment
Other Devices and

66 76 89 91 96 93 80 91 103 109 95 97 94
Supplies
Other
Pharmaceuticals 11 10 10 13 14 17 22 20 31 39 39 37 28
and Biotechnology
Pharmaceuticals 89 86 66 74 61 80 63 57 68 88 68 86 67
Surgical Devices 102 123 114 105 128 131 115 112 115 114 109 140 117
Therapeutic Devices 111 147 129 150 154 163 155 182 201 199 209 226 203
US VC Deal and Company Count in Life Sciences

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Life Sciences Deal

1,057 1,178 1,206 1,368 1,460 1,593 1,544 1,771 1,889 2,008 2,146 2,605 2,082
Count
Life Sciences as % of
18.9% 16.9% 14.9% 13.6% 13.2% 13.4% 14.3% 15.1% 15.2% 14.9% 16.1% 14.0% 12.6%
Total US VC (#)
Company Count 975 1,092 1,114 1,278 1,368 1,482 1,477 1,674 1,775 1,878 2,010 2,381 1,925
US VC Deal Value in Life Sciences

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Life Sciences Capital

$8.4 $9.4 $9.5 $11.4 $14.3 $16.5 $15.6 $20.6 $29.0 $27.1 $40.6 $54.7 $43.0
Invested ($B)
Life Sciences as % of
26.0% 20.6% 22.7% 22.7% 19.3% 19.1% 18.5% 22.9% 19.8% 18.1% 23.7% 15.8% 17.8%
Total US VC ($)
27
Data provided by
Corporate Venture Capital

US Corporate VC Investment by Year
# of # of VC Deals % of VC Deals Average Average Median Median Average Average Median Median Total VC Total CVC % of VC
All VC with CVC with CVC Deal Value Deal Deal Deal Post-Money Post- Post- Post- Capital Capital Deals
Deals Involvement Involvement (All VC, Value Value Value Valuation Money Money Money Raised ($M) Raised ($B) with CVC
(#) $M) (CVC, (All VC, (CVC, (All VC, $M) Valuation Valuation Valuation Involvement
$M) $M) $M) (CVC, $M) (All VC, $M) (CVC, $M) ($)
2004 2,683 527 19.6% $8.7 $13.1 $5.2 $9.2 $34.5 $47.3 $20.7 $31.2 $21,894.7 $6,641.1 30.3%
2005 3,063 548 17.9% $8.3 $10.8 $5.0 $7.0 $38.9 $54.4 $20.5 $29.5 $23,927.4 $5,591.6 23.4%
2006 3,431 612 17.8% $9.5 $16.6 $5.0 $9.7 $45.6 $65.8 $22.0 $39.1 $30,027.1 $9,615.7 32.0%
2007 4,502 712 15.8% $8.9 $16.4 $4.2 $10.0 $54.7 $115.7 $22.2 $39.7 $36,411.0 $11,112.5 30.5%
2008 4,872 754 15.5% $8.2 $13.9 $3.6 $8.2 $53.8 $69.2 $20.3 $33.7 $37,128.2 $9,973.3 26.9%
2009 4,604 550 11.9% $6.6 $13.9 $2.5 $8.0 $52.4 $78.5 $16.7 $34.2 $27,863.5 $7,063.0 25.3%
2010 5,586 634 11.3% $6.4 $14.9 $2.0 $8.0 $57.6 $89.1 $16.5 $33.0 $32,445.5 $8,742.5 26.9%
2011 6,950 846 12.2% $7.4 $18.0 $1.7 $6.5 $111.6 $170.6 $16.4 $37.0 $45,667.2 $13,946.1 30.5%
2012 8,092 951 11.8% $5.8 $13.8 $1.5 $6.2 $54.2 $85.5 $15.4 $32.2 $41,715.9 $12,047.0 28.9%
2013 10,036 1,256 12.5% $5.8 $14.0 $1.5 $5.6 $57.5 $117.7 $15.0 $34.0 $50,103.5 $15,982.6 31.9%
2014 11,084 1,547 14.0% $7.7 $19.7 $1.5 $6.6 $101.4 $186.6 $16.2 $37.2 $73,765.2 $27,752.0 37.6%
2015 11,870 1,756 14.8% $8.4 $24.0 $1.6 $7.1 $115.7 $299.0 $17.0 $40.5 $86,427.6 $38,244.5 44.3%
2016 10,829 1,737 16.0% $8.8 $25.1 $2.0 $8.0 $111.4 $281.2 $17.8 $35.6 $84,021.1 $39,207.4 46.7%
2017 11,730 1,976 16.8% $8.8 $20.1 $2.0 $8.0 $90.1 $155.9 $18.0 $35.5 $90,030.9 $35,750.5 39.7%
2018 12,410 2,267 18.3% $13.5 $34.6 $2.5 $9.0 $155.1 $308.0 $20.1 $41.1 $146,411.1 $71,701.5 49.0%
2019 13,513 2,444 18.1% $12.8 $27.7 $2.6 $10.0 $139.4 $192.2 $20.5 $48.4 $149,295.4 $61,036.2 40.9%
2020 13,359 2,540 19.0% $15.0 $35.6 $3.0 $10.0 $178.7 $292.9 $22.0 $50.0 $171,396.3 $82,442.1 48.1%
2021 18,620 3,794 20.4% $22.5 $46.8 $4.0 $13.4 $303.5 $543.2 $35.6 $79.3 $161,235.0 46.7%
$345,448.0
2022 16,464 3,281 19.9% $18.6 $37.8 $4.2 $12.0 $247.1 $355.4 $40.0 $80.5 $240,931.3 $108,421.0 45.0%
28
Data provided by
Growth Equity
Share of US Growth Equity Investments in 2022 by Sector
Commercial Products & Services
Consumer Goods & Recreation
22.5%
Energy
33.5%
HC Devices & Supplies
HC Services & Systems
11.9% IT Hardware
Media
5.9%
2.3% Other
4.7%
11.2% 3.4%
Pharma & Biotech
1.5% Software
3.1%
US Growth Equity Deal Activity

$250 3,500
2,866 3,000
$200
2,500
2,167
$150 1,730
1,579 2,000
1,407
1,120 1,107 1,500
$100 1,033
969
718 773 1,000
672
574
$50 424
$111.3
$229.3
$128.4
500
$15.1
$18.2
$25.6
$25.4
$27.4
$44.3
$48.8
$46.7
$47.7
$76.6
$83.5
$0 0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal value ($B) Deal count
Note: Growth equity is not included as a subset of overall VC data in this publication; it is instead its own unique dataset. More details on the methodology are on page 52.
29
Data provided by
Exit Landscape:
Venture-backed
IPOs & M&As
Overview US IPOs by Year
# of All IPOs # of VC-Backed IPOs
Exits come in a variety of forms including
2009 267 10
public listings, acquisitions, and SPACs as
2010 373 45
a result of positions that are liquidated,
2011 343 46
and funds either returned to GPs and
LPs or reinvested in future funds. After 2012 433 60
a blockbuster 2021, overall disclosed 2013 452 87

exit values in 2022 were down by over 2014 462 126
90%, and the number of disclosed exit 2015 341 86
transactions dropped by 36%. Across
2016 229 43
most of the other types of transactions,
2017 286 69
the US share remained flat from 2021
to 2022. However, from 2021 to 2022, 2018 280 94
the US’ share of disclosed global exit 2019 277 90

value dropped by 57%, the lowest share 2020 505 109
in at least 20 years. While there are 2021 1,001 191
likely significant numbers of undisclosed
2022 194 36
Top 10 US VC-backed IPOs in 2022

Company Name Exit size ($M) Industry Sector State
Prime Medicine $1,452.4 Healthcare Massachusetts
Credo $1,215.6 IT California
Amylyx $882.9 Healthcare Massachusetts
Third Harmonic Bio $472.5 Healthcare Massachusetts
CinCor Pharma $390.7 Healthcare Massachusetts
Arcellx $379.4 Healthcare Maryland
HilleVax $338.3 Healthcare Massachusetts
Vigil Neuro $297.7 Healthcare Massachusetts
AN2 Therapeutics $212.1 Healthcare California
Acrivon Therapeutics $166.4 Healthcare Massachusetts
30
Data provided by
transactions that would lessen that

relative decline, the magnitude of the drop
Ratio of IPO Pre-Valuation to Total VC Invested
should be examined. Post-Money Capital Raised IPO Pre-Money Total VC Raised Ratio
Value ($B) ($B) Value ($B) to Date ($B)
Public Listings 2010 $16.0 $12.8 $12.8 $3.2 3.9
2011 $43.3 $37.8 $37.8 $5.5 6.8
In 2022, there were 36 IPOs of venture- 2012 $112.8 $91.6 $91.6 $21.2 4.3
backed companies, which is less than 2013 $53.0 $44.1 $44.1 $8.8 5.0
half as many IPOs as any year since 2017, 2014 $53.7 $44.4 $44.4 $9.3 4.8
when there were 69 IPOs of venture-
2015 $38.9 $31.1 $31.1 $7.7 4.0
backed companies. Steep declines in
2016 $16.1 $13.3 $13.3 $2.9 4.6
healthcare, biotech, and software drove
this drop. The three-year average for 2017 $60.2 $50.7 $50.7 $9.4 5.4
biotech & pharma IPOs was 66—almost 2018 $76.4 $64.4 $64.4 $11.9 5.4
twice the total number of IPOs in 2022. 2019 $222.4 $178.4 $178.4 $44.0 4.1
Consumer goods & services companies 2020 $251.4 $215.6 $215.6 $35.8 6.0
that exited via IPO were on average one
2021 $619.2 $512.6 $512.6 $106.7 4.8
full year older than companies in the same
2022 $8.4 $6.6 $6.6 $1.8 3.6
sector that listed in the prior three years.
2022’s exit environment was

characterized by a small number of public
listings of small-cap companies and less
M&A some remain private. Aggregate deal
values should be viewed with even more
liquidity reintroduced to the market than skepticism because, while common,
Due to a lack of requirements for public
in previous years. The exact cause of deal values for many transactions are
disclosure, M&A activity should be
the reduction in activity is not clear, but frequently undisclosed.
viewed as directional. While most M&A
market conditions need to change before
transactions are publicly disclosed,
the IPO window can reopen.
US VC-backed IPO Value and Age Characteristics

# of IPOs Deal Value Median Deal Average Deal Post-Money Median Post- Average Median Years Average Years
($M) Value ($M) Value ($M) Value ($M) Money Value Post-Money from First VC from First VC
($M) Value ($M) to Exit to Exit
2010 45 $12,787.9 $199.3 $297.4 $16,035.6 $277.2 $372.9 6.3 6.8
2011 46 $37,793.3 $331.2 $944.8 $43,333.3 $423.6 $1,083.3 5.8 6.7
2012 60 $91,613.3 $291.7 $1,832.3 $112,792.3 $353.2 $2,050.8 7.1 7.7
2013 87 $44,148.7 $240.1 $573.4 $52,970.8 $328.5 $654.0 6.7 7.3
2014 126 $44,415.5 $187.1 $370.1 $53,708.5 $249.4 $451.3 7.1 7.2
2015 86 $31,134.7 $219.3 $404.3 $38,872.4 $294.0 $492.1 6.5 6.1
2016 43 $13,270.2 $178.3 $316.0 $16,132.0 $239.3 $375.2 7.5 7.0
2017 69 $50,734.5 $264.7 $831.7 $60,163.5 $349.3 $986.3 6.3 6.5
2018 94 $64,444.8 $330.8 $724.1 $76,358.8 $411.0 $848.4 4.6 6.4
2019 90 $178,397.8 $353.9 $2,050.5 $222,359.4 $456.4 $2,526.8 6.6 6.7
2020 109 $215,567.3 $508.2 $2,134.3 $251,404.8 $703.7 $2,440.8 5.2 6.2
2021 191 $512,560.0 $566.6 $2,945.7 $619,212.8 $707.8 $3,459.3 5.4 6.3
2022 36 $6,599.0 $54.4 $235.7 $8,447.0 $78.9 $301.7 3.1 5.1
31
Data provided by
US VC-backed M&A Activity

$350,000 1,800
1,630
$300,000 1,600
1,400
$250,000 1,191
1,152
1,103 1,200
984 1,022 972 1,006 1,164
$200,000 1,000
833 838
$150,000 696 710 800
475 600
$100,000
289 263 290 400
234 238 242 242 224 221 251 226
$50,000 174 144
129 200
$0 0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal Value ($M) # of Acquisitions # with Disclosed Values
In 2022, overall year-on-year deal counts

declined by nearly 30% in overall US VC-
SPACs Going Forward
backed M&A activity. When compared
SPACs were a major factor in the public The drop in US VC-backed exits over 2022
with an average of the past three years,
markets in 2020 and 2021, with 229 and was worrisome for anyone wanting to see
activity was only down 13%. Of disclosed
558 transactions totaling $70.6 billion and a healthy VC sector. Historically, VC exits
transactions, the largest decrease in
$135.5 billion, respectively. In 2022, there have been a major provider of liquidity to
activity was an annual drop of 40% in
were 71 transactions with a combined the markets. As recently as 2021, the 191
commercial products & services M&A.
value of $10.4 billion. Additionally, the VC-backed IPOs provided a combined
Energy M&A transactions doubled year-
De-SPAC Index dropped nearly 70% over $512 billion to the markets. The drop in
on-year, but this was only a jump from
the course of 2022. Early 2023 has been activity between 2021 and 2022 is likely
six to 12 recorded transactions, with no
kinder to the asset class, with the index caused by the same mix of geopolitical
disclosed values in 2021, so the overall
rising 23% since the beginning of the year. and macroeconomic factors influencing
impact of the sector on overall national
the rest of the market. Therefore, it is
deal values was likely minimal.
reasonable to assume that a change in
these factors is necessary before public
listings will return to historical norms.
US VC-backed M&A Value and Age Characteristics

# of Acquisitions # with Disclosed Values Deal Value ($M) Median Deal Value ($M) Average Deal Value ($M) Median Years from First VC to Exit Average Years from First VC to Exit
2009 475 129 $13,160.9 $22.0 $91.4 4.4 4.8
2010 696 234 $35,439.1 $40.0 $135.8 4.3 5.0
2011 710 238 $29,681.2 $40.3 $107.9 4.2 4.8
2012 833 242 $36,818.5 $40.0 $136.4 4.6 5.1
2013 838 242 $30,739.9 $35.0 $109.0 3.8 5.0
2014 984 289 $68,733.1 $50.0 $205.8 4.3 5.3
2015 1,022 263 $46,265.0 $45.0 $153.2 4.2 5.3
2016 972 224 $290,165.3 $65.0 $1,036.3 4.4 5.5
2017 1,006 221 $51,427.3 $50.0 $189.8 4.9 5.9
2018 1,152 251 $69,751.6 $70.0 $220.0 5.1 6.0
2019 1,191 226 $71,333.4 $69.5 $216.2 5.1 5.9
2020 1,103 174 $80,165.0 $70.8 $277.4 5.3 6.2
2021 1,630 290 $115,800.6 $67.8 $233.5 5.4 6.1
2022 1,164 144 $37,548.2 $59.0 $169.1 5.5 6.3
32
Data provided by
A FEW QUESTIONS GOING INTO

US SPACs activity
2023:
$160 600
558
Is the drop in the American share of $140
500
global VC exit value the start of a trend?
$120
400
Before 2022, the United States never $100
made up less than 41% of the global VC- $80 300
backed exit value. While it is normal to 229
$60
have down years, such a down year merits 200
further scrutiny, and the VC-backed exits $40
in other countries ought to be examined. 54 100
$20 29 37 71
3 15 10 7 12 17 9
What kinds of companies were most $0 0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
likely to list in 2022?
Exit value ($B) Exit count
The average company that listed in 2022 Source: NVCA 2023 Yearbook, Data provided by PitchBook
was significantly older than average

when compared with prior years. Public Improvements in investor confidence and were critical in averting a financial
listings were also down across all sectors price stability would probably set the stage panic in mid-March, some proposed
except energy, which had a slight year-on- for an improved exit environment. regulations on the VC sector are forecast
year increase. to have a comparably negative impact
What impact are actions by the federal on the market. The full impact of the
What needs to happen for exit activity to government going to have on exits appropriation of funds in laws such as the
return to historical norms? in 2023? IRA and the CHIPS and Science Act are
of significant industry interest, but their
While the potential causes of 2022’s dismal The federal government has a major full impact is unlikely to flow through to
exit activity are legion, exits are impacted by role to play in 2023. While regulatory exits in any significant measure by the end
the same factors as the rest of the market. interventions in the banking sector of 2023.
US VC-backed IPO Post-Money US VC-backed M&A by Range

Valuation by Range (Company Count) (Company Count)
>$10B $1B- $500M- $100M- <$100M $500M- $100M-
>$1B <$100M
$10B $1B $500M $1B $500M
2012 1 7 11 33 8 2012 6 8 68 751
2013 1 9 12 49 16 2013 4 8 71 755
2014 - 11 18 73 24 2014 9 15 97 863
2015 - 8 14 39 25 2015 8 13 85 916
2016 - 3 8 22 10 2016 8 16 87 861
2017 1 13 11 27 17 2017 10 15 73 908
2018 - 19 15 48 12 2018 10 16 100 1,026
2019 4 23 13 39 11 2019 9 19 95 1,068
2020 6 26 42 25 10 2020 20 12 75 996
2021 14 56 40 48 33 2021 26 29 123 1,452
2022 - 3 4 5 24 2022 4 13 57 1,090
Source: NVCA 2023 Yearbook, Data provided by PitchBook Source: NVCA 2023 Yearbook, Data provided by PitchBook
33
NVCA’s 2022
Year in Review
Our three platforms collectively served the venture ecosystem through advocacy, research, education, programming, and
advancing the VC industry.
Three Complementary Structures Supporting the Venture Ecosystem
VenturePAC
Public Charity Trade Association Political Action Committee
501(c)(3) 501(c)(6) 527
• Mission-driven • Membership-driven • Membership/Politics-driven

• Programs, research, and events • Lobbying and advocacy efforts • Supports the election of
that directly serve the good of to protect the VC industry from candidates who champion for
the community and its members external regulatory forces the VC industry
• Funded by donations from • Funded by annual member firm • Funded by individual
individuals or private entities dues contributions
• Donations are tax-deductible • Membership dues are not tax- • Donations are not tax-deductible
deductible
This timeline features highlights from the past year to provide the VC community with an overview of our priorities, impact, and
accomplishments.
San Francisco Happy Hour Board Capitol Hill Event
34
Data provided by
March April May June
Venture Capitol Podcast: JOBS Act: NVCA celebrated LP Office Hours Chicago: 2022 NVCA Leadership Gala:
NVCA launched the Venture the 10th anniversary of the Venture Forward facilitated NVCA presented individuals,
Capitol podcast (that’s Capitol Jumpstart Our Business 84 meetings between 21 firms, and organizations across
with an “O,” as in Capitol Hill) Startups (JOBS) Act signed into participating underrepresented the venture capital community
hosted by NVCA President and law by President Obama on and emerging managers (EMs), with its annual industry
CEO Bobby Franklin. Venture April 5, 2012, and expressed seven LPs, and five experienced awards (see highlight reel and
Forward’s Maryam Haque support for provisions in the press release).
GPs for the seventh LP Office
joined Bobby for the inaugural new JOBS Act 4.0 package. Hours (LPOH) program. The
episode to discuss making Chicago program, sponsored New Board Chair: NVCA
venture capital accessible to all. Tax Incentives Spur by Cooley, marked the first appointed Emily Melton,
time that the LPOH program Managing Partner at Threshold
Innovation: NVCA supported
took place in-person since Ventures, as the 2022-2023
State Small Business Credit the introduction of several tax
November 2019. Chair of the NVCA Board
Initiative (SSBCI) Webinar: policy proposals to make long-
of Directors.
Venture Forward, NVCA, and term investment in innovation
the US Treasury Department more attractive. Fireside Chat with NSF:
hosted a webinar to share Daniel Goetzel of the Model Legal Documents:
more information about SSBCI Technology Innovation and NVCA updated the free
VC Leaders in Climate and Model Legal Documents with
equity capital programs, their Sustainability: In honor of Partnerships (TIP) Directorate
guidelines and FAQs, and best a new Enhanced Investors’
Earth Day, NVCA recognized at the National Science
Rights Agreement and a new
practices for VCs considering five leading VCs in climate and Foundation (NSF) joined NVCA
Enhanced Model Term Sheet
SSBCI funds. sustainability investing within to outline the goals of the version 3.0 in partnership with
the NVCA member community. new directorate and highlight Aumni (documents here).
Startup Visa: NVCA expressed partnership opportunities
support for a Startup Visa in the regional innovation
SEC Private Funds Comments: engines program. Venture Forward on Capitol
via a statement for the record NVCA submitted comments Hill: On June 30, Venture
sent to Senators Alex Padilla on the SEC’s proposed rules Forward Executive Director
(D-CA) and John Cornyn for private fund advisors and Maryam Haque testified at
(R-TX) in advance of a March raised concerns with several of the House Financial Services
Senate Judiciary Committee its provisions that would hurt Committee’s Task Force on
immigration hearing. the VC ecosystem. Financial Technology’s hearing
to stress the importance of
DEAL Act Reintroduced: diversity, equity & inclusion
NVCA was thrilled to see the (DEI) in VC (full testimony).
reintroduction of the Developing
and Empowering our Aspiring
Leaders (DEAL) Act by Senator
Mike Rounds (R-SD), a longtime
legislative priority that helps
improve returns and capital
formation in the initial stages of
the startup ecosystem.
VC Leaders in Climate and Sustainability 2022 NVCA Leadership Gala
35
Data provided by
July August September October
SSBCI Webinar: NVCA and ESG in VC: Moving Beyond Talk Denver Boots on the Ground: Venture Forward Board
Venture Forward co-hosted a to Action: Venture Forward, The NVCA team traveled to Appointments: Venture
webinar for EMs to learn more NVCA, Nasdaq Entrepreneurial Colorado for a Leadership Forward appointed three
about SSBCI and how to apply. Center, and PitchBook dinner hosted in partnership new members to its board
NVCA and Venture Forward hosted 120+ attendees for with Cooley, bringing together of directors: Barry Eggers,
continue to maintain the SSBCI an educational event for VCs in the Rocky Mountain Founding Partner of
resource page to share the VC investors interested in ecosystem and to collaborate Lightspeed; Samara Hernandez,
latest information on approved learning about the current with the NVCA GC Advisory Founding Partner of Chingona
states, their programs, and the state of environmental, social Board on updates to the NVCA Ventures; and Courtney McCrea,
application process. & governance (ESG) and best Model Legal Documents. Cofounder and Managing
practices for implementing Partner of Recast Capital.
LGBTQ+ Investor Mixer in San ESG policies.
Board Service Excellence
Francisco: Venture Forward, Event: New in 2022, NVCA’s Spotlight on Nashville: On
StartOut, and SVB hosted 40 VC Human Capital Survey: September 15 Board Service October 26, NVCA convened
attendees for a reception in San NVCA, Venture Forward, and Excellence Forum, hosted in top VCs and innovators for
Francisco with emerging and Deloitte launched the 2022 VC partnership with Latham & the Nashville iteration of
experienced VC investors. Human Capital Survey, with Watkins and SVB, provided 80+ NVCA’s “Spotlight On” series,
outreach to 2,500 active US- VC investors with actionable a bimonthly virtual series
CHIPS and Science Act: based VC firms. insights and expertise to highlighting VC and innovation
The NVCA-supported enhance their impact and ecosystems in cities and regions
competitiveness legislation Inflation Reduction Act: NVCA effectiveness as board across the country. In addition
formerly known as USICA and celebrated historic wins for members. The Austin-based to Nashville, NVCA featured
currently known as the CHIPS climate technology startups event featured panels with St. Louis, Washington, DC,
and Science Act, passed both with the passage of the perspectives from across the VC Chicago, and Boulder/Denver,
chambers of Congress. It was Inflation Reduction Act. ecosystem. Couldn’t make it to Colorado, in 2022.
signed into law on July 27 by Texas? Don’t miss NVCA’s key
President Biden. takeaways from the program.
SEC Meetings: NVCA board Washington Boots on the

members met with SEC Ground: The NVCA Board
Commissioner Hester Peirce of Directors traveled to
to discuss key issues in the Washington, DC, for NVCA’s
agency’s private funds proposal, September board meeting.
such as the SEC’s proposed While visiting the nation’s
indemnification and post-tax capital, the board engaged
clawback prohibitions, side with policymakers on Capitol
letter rules, and the lack of Hill and at the Securities and
grandfathering for existing fund Exchange Commission.
terms. One week later, NVCA
also met with SEC staff about Blockchain Boots on the
its proposed changes to 10b5-1 Ground: NVCA’s Blockchain
securities trading plans (see Working Group discussed
comment letter). the promise of blockchain
technology and regulatory
issues with policymakers in
Washington, DC.
Climate Event: Back on the

West Coast, the NVCA Climate
& Sustainability Working Group
convened in San Francisco
to discuss technology policy
legislation and trends in carbon
markets. The event, hosted in
partnership with Morgan Lewis,
was followed by a happy hour
with other climate VC investors.  
36
Data provided by
November December January 2023 February 2023
Strategic Operations and Funding for CHIPS and Members-Only Healthcare Virtual Annual Meeting: The
Policy Summit: NVCA Science Act: NVCA sent a Innovation Event: NVCA, Sidley, NVCA Annual Meeting returned
welcomed 110+ senior letter to House and Senate and SVB hosted VC investors in a new virtual format to
operations professionals to appropriators requesting that and operators for drinks and maximize members’ time from
the sixth annual Strategic they prioritize robust and conversation at the Venture the comfort of their homes
Operations & Policy Summit predictable funding for the Forward Office in San Francisco. or offices. NVCA updated
(SOPS) in Washington, DC. technology commercialization its membership on the state
We heard from leading VC programs passed as part of the of venture capital, the policy
Women in Healthcare VC
thought leaders on industry- CHIPS and Science Act. outlook for 2023, and ways to
Mixer: Venture Forward hosted
related policy content, advance the industry.
a networking reception with
back-office systems, and tax, Venture Forward Holiday Deloitte, Forge Biologics, and
regulatory, cryptocurrency, and Party: Venture Forward SVB to assemble VC investors Capital Readiness Program
fundraising best practices. brought together donors, and VC-backed startup and Opportunities for VCs:
program volunteers, and founders in healthcare. NVCA, Venture Forward,
LP Office Hours: In partnership program participants for the and the Minority Business
with Cooley, Venture Forward first time since its launch in Development Agency held an
Miami Leadership Dinner: The
hosted the eighth LP Office 2020. The party was hosted at informational webinar for 125+
NVCA team traveled southward
Hours program to connect Andreessen Horowitz’s office in attendees to learn more about
to gather 20+ members and
25 emerging managers from San Francisco and sponsored the MBDA Capital Readiness
prolific VCs in the Florida
diverse backgrounds with LPs, by J.P. Morgan and Deloitte. Program’s criteria, application
ecosystem for a leadership
GPs, and industry advisors for View the full event gallery. process, timeline, and more.
dinner in Miami.
guidance on fundraising and
fostering relationships from 12
family offices. 50 Years of Empowering Black History Month: In honor
Entrepreneurs: NVCA officially of Black History month, Venture
kicked off a year of celebration Forward showcased five up-
NVCA in New York: NVCA and-coming Black emerging
to commemorate its 50th
hosted a New York leadership managers to amplify their
anniversary. Founded on
dinner and convened NVCA’s incredible work. Combined,
January 29, 1973, NVCA helps
Growth Equity Group (following they manage $120 million+ in
impact policy and legislation
a September dinner in Palo VC assets.
to encourage new company
Alto, California) to review the
formation, protect long-
latest trends in politics and
term investment, promote Q4 2022 PitchBook-NVCA
policy and their impact on
entrepreneurship, and ensure Venture Monitor Webinar:
growth companies.  
that the US economy remains NVCA and PitchBook, in
competitive in the global partnership with Insperity,
Climate VC Roundtable: race for innovation (full J.P. Morgan, and Dentons,
Following the formal kickoff press release). presented an informative
of the IRA’s implementation webinar featuring industry
process, NVCA headed west experts highlighting insights
for a roundtable discussion from the Q4 2022 PitchBook-
in Santa Monica, California, NVCA Venture Monitor.
with Deputy Secretary of
the Treasury Wally Adeyemo
and climate tech investors
(see comments from NVCA’s
Climate & Sustainability
Working Group on the
implementation of the direct
pay and transferability
mechanisms).
NVCA Leadership Dinner in New York
37
Shaping
Diversifying, the future
educating, and
empowering the VC investor
of venture capital
class to advance the industry
and maximize impact and returns
ventureforward.org
Venture Forward is a 501(c)(3) supporting
Venture Forward is a 501(c)(3) supporting organization to NVCA.
organization to NVCA.
NVCA EMPOWERS
THE NEXT GENERATION
OF AMERICAN COMPANIES
As the leading trade organization

in this country, NVCA provides
a wealth of resources for VCs,
including access to exclusive data,
education, connecting with peers,
and shaping the policy agenda.
Beth Seidenberg
Founding Managing Director
of Westlake Village Biopartners
Become a NVCA member today | www.nvca.org

Data provided by
NVCA Public Policy

Priorities
The 2022 midterm elections capped The Inflation Reduction Act did include apprenticeship, domestic content, and
a historically productive Congress for several pro-startup policies, such as: energy communities provisions that will
bipartisan dealmaking, with several increase the value of credits by five times
• An increase in the maximum amount
generational technology-related legislative for compliant projects.
that startups can monetize research
packages crossing the finish line. Macro
& development (R&D) credits, from
factors such as unabating populism
$250,000 to $500,000 per year
and increasing conflict between major
democratic and authoritarian powers • Direct pay for certain energy credits,
continue to drive a fundamental transition meaning they can be monetized
in US technology policy. These factors in full by startups in the year they
are generated CHIPS and Science Act
were key drivers in the dealmaking during
the previous Congress as well as ongoing • Transferability for all energy credits, In another major win, the NVCA-supported
efforts to decouple the Chinese and allowing startups to transfer advanced CHIPS and Science Act passed Congress
US economies. energy credits to corporations and on a bipartisan basis in 2022. With a $250
individuals with so-called “tax billion top-line number, the CHIPS and
While we fought through a number of appetite,” or an ability to use the Science package represents the single
populist policy proposals in 2022, we were credits to offset their tax obligations largest investment into research, technology
able to avoid many potential threats and commercialization, workforce development,
• Making energy storage eligible for the
are excited that many of the new programs and domestic production in decades.
investment tax credit
will seek to leverage the capabilities of
America’s startup ecosystem to address There are a range of climate tax credits
Notably, there is a newly established
societal challenges. extended, expanded, and created by IRA,
NSF directorate focused on technology
including credits to support:
commercialization, the Technology,
Below is a look back at one of the busiest • Clean energy generation and storage Innovation, and Partnerships (TIP)
years in NVCA history and a review of the Directorate, headed by Dr. Erwin
• Carbon capture
current state of the issues. Gianchandani. This directorate is
• Alternative transportation fuels working on building out a number of new
• Domestic manufacturing technology programs created by the CHIPS
and Science Act, starting with the Regional
• Transportation/clean vehicles
Innovation Engines program.
NVCA is heavily engaged in the
implementation of the IRA. The Treasury We’re also engaging with several
Inflation Reduction Act and IRS are writing regulations for the technology commercialization programs
climate tax credit programs, which are the that are run by the Department of
NVCA successfully worked over the cornerstone of the Biden administration’s Commerce, including the CHIPS for
previous Congress to ensure the that the climate agenda. We submitted comments America fund, Regional Innovation Hubs,
following harmful proposals were not in response to the request for information and RECOMPETES.
included in the IRA: (RFI) from the Treasury and IRS on
• Taxing capital gains as ordinary income implementation of the direct pay and As only the CHIPS element of the package
transferability mechanisms that allow is fully paid for, the Science portion must
• Taxes on unrealized capital gains
startups to monetize their credits. We also obtain approval of funding of funding
• Increased taxes on carried interest submitted comments in response to the RFI from House and Senate appropriators.
• A retroactive QSBS restriction on implementation of the prevailing wage,
39
Data provided by
NVCA sent a letter to appropriators fund agreements. Read NVCA’s through a regulatory proposal, which we
requesting that they prioritize robust and comment letter. will have to engage on.
predictable funding for the technology
• Form PF: The Form PF proposal
commercialization programs passed as
impacts registered investment advisors
part of the CHIPS and Science Act.
(RIAs) by shortening the reporting
period and lowering the threshold that
Our implementation strategy involves
determines which funds must report as
closely engaging with the various agencies
“large private equity advisers.” Read SSBCI: 39 States and Counting
and rolling out a series of events, collateral,
NVCA’s formal response to the SEC.
and a more in-depth analysis of the The Treasury has approved 39 state
bill’s provisions to educate the NVCA • Schedules 13D and 13G: This applications for the State Small Business
membership on partnership opportunities. proposal would shorten filing Credit Initiative (SSBCI) so far. The SSBCI
deadlines for beneficial ownership provides states with $10 billion in funding
reports filed on Schedules 13D and to run small business debt and equity
13G. Read NVCA’s response here. investment programs. Please take a look
• 10b5-1 plans: The SEC has issued a at NVCA and Venture Forward’s SSBCI
final rule to require a 90-day cooling resource center for more information on
SEC Regulatory Update period, prohibit overlapping plans, and approved state plans, including a list of
mandate quarterly disclosures. Read equity programs and points of contact.
NVCA has continued engagement with NVCA’s comment letter.
SEC Chair Gary Gensler’s disruptive Looking Forward
NVCA is continuing outreach to SEC
regulatory agenda, including defending the
officials, legislators, and the Biden As we begin 2023 with narrow Republican
industry from five key proposals in 2023:
administration to discuss the harmful control of the House of Representatives,
• Private funds proposal: The SEC impact the Gensler proposals will have on the divided government will confine the
is proposing to: 1) ban a range of the venture ecosystem. 118th Congress’ legislative ambitions,
common VC fund agreement terms
but there will be plenty of action at the
for all private funds, including
agencies as they work to implement dozens
Exempt Reporting Advisors, such
of new technology programs with an
as indemnification for negligence,
unprecedented amount of new funding.
post-tax clawbacks, and charging
Although the debt ceiling debate will
certain fees to a fund; 2) limit certain Regulation D Disclosure Effort
consume a great deal of congressional
information in side letters and
NVCA successfully fought off a proposal time at first, we expect Congress to focus
require notice of side-letter rights for
during the CHIPS and Science debate that on several areas of interest, including the
prospective and existing LPs; and 3)
would have forced private companies to capital markets and regulatory space,
mandate quarterly reports for LPs,
publicly report financing rounds at both R&D tax issues, continued efforts on
with detailed information regarding
their outset and completion. Though China decoupling, and antitrust. We will
fees, expenses, and performance
we succeeded in bringing down the also focus on the SEC, where Chair Gary
(applicable to registered investment
amendment from Representative Brad Gensler is working through a number of
advisors only). Notably, the proposal
Sherman (D-CA), we understand that the proposals that could be quite disruptive for
lacks a grandfather clause for existing
SEC is interested in doing something similar the startup ecosystem.
Justin Field Charlotte Savercool Jonas Murphy Gillian Carney

Senior Vice President Vice President of Manager of Public Policy
of Government Affairs Government Affairs Government Affairs Coordinator
jfield@nvca.org csavercool@nvca.org jmurphy@nvca.org gcarney@nvca.org
40
Data provided by
NVCA Member
Community
Diverse, Engaged, Committed
Join NVCA’s dynamic member network, with representation from 42+ states and
seed investors to growth-stage funds. Emerging managers and well-established
VC firms contribute to a vibrant and productive community from coast to coast.
NVCA empowers the next generation of American companies that will fuel the economy of tomorrow. As the voice of the US
venture capital and startup community, NVCA advocates for public policies that support the American entrepreneurial ecosystem.
NVCA also fosters the success of the venture industry through valuable education, differentiated networking opportunities, and
best-in-class data and resources.
See a full list of NVCA members here.
Who are NVCA members?

• VC partnerships
• Corporate venture groups
• Growth equity firms
• Family offices
• Fund of funds
• State-Funded Organizations/Nonprofits
• Accelerators
• Incubators
41
Data provided by
NVCA Supports Its Member

Community Through:
Key Programs and Must-Attend Events What’s Hot in 2023
Initiatives
• Member Working Groups:
• 50th Anniversary Leadership and
Members discuss challenges
• CFO Task Force: VC chief financial Awards Gala: Annual gathering
and opportunities with a focus
officers and senior operators in San Francisco of leading VCs,
on regulatory, legislative, and
engage in virtual and in-person honoring investors who have
operational issues. Working
meetings to discuss shared made significant contributions to
groups are refreshed annually and
challenges and best practices in the industry.
include Climate and Sustainability,
accounting, back-office operations,
Education and Workforce
and financial reporting. The Task • Strategic Operations and Policy
Development, Blockchain,
Force also distributes a quarterly Summit: Washington, DC-based
Healthcare Innovation, and
valuation survey among members, program for CFOs, chief operating
National Security.
which confidentially highlights officers (COOs), GPs, and other
best practices in valuation among professionals at VC firms to
• VC Leadership Dinners: Intimate
the VC community. Continuing examine accounting best practices,
gatherings of GPs in cities from
professional education (CPE) the role of operators in venture,
coast to coast.
credit is available. This is NVCA’s and relevant public policy issues.
largest working group, with 200+
• Spotlight On Series: Web series
active participants. See all NVCA events here.
highlighting VC ecosystems in
geographies across the US.
• Corporate Venture Network:
Community for learning
and dialogue on issues of How To Become a • Vertically Focused Happy
Hours: Investors and finance
interest to corporate venture
Member professionals from VC firms with
investors. Participants benefit
similar investment preferences
from peer mentorship, skill-
Visit nvca.org to apply online. convene in diverse ecosystems.
building workshops, and
diverse perspectives on
Questions? Contact
corporate innovation.
membership@nvca.org.
• Growth Equity Roundtable:

Platform for growth-stage
investors to exchange ideas. This
Roundtable includes a dedicated
forum for firm operators to share
knowledge and discuss common
regulatory concerns.
Jason Vita Jenny Zemel

Vice President, Manager, Member
Business Operations &
Development Experiences
jvita@nvca.org jzemel@nvca.org
42
Data provided by
NVCA Industry
Partner Program
Advisors, Leaders, and Experts
NVCA and its members rely on a strong network of service providers for guidance and expertise. Through NVCA’s Industry Partner
Programs, leading companies and organizations engage with an exclusive and a diverse set of venture investors. Industry Partner
benefits include:
Enhanced brand Strategic business Platform for

awareness development thought-leadership
Who Are Industry What Can Industry

Partners? Partners Do? How To Become an
Industry Partner
• Accounting firms • Sponsor events and newsletters
Do your services add value
• Banking and financial institutions • Host speaking engagements to the VC ecosystem?
• Consulting and advisory services • Provide thought-leadership Learn more about the
content program here.
• Law firms
• And more!
• Research and data providers
• Companies supporting startups
Robin Ceppos Savannah Maloney

Communications Communications
Manager Coordinator
rceppos@nvca.org smaloney@nvca.org
43
Data provided by
Venture Forward
Highlights
Venture Forward is a 501(c)(3) nonprofit founded by NVCA to build
a stronger, more diverse, equitable, and inclusive future for VC. The
organization provides resources and opportunities to help aspiring
investors enter the industry, current investors advance, and VC firms
implement meaningful DEI practices.
Historically, VC opportunity, access, and success have been concentrated

among a few demographics. Women, people of color, other marginalized communities, and people outside of a handful of
metropolitan areas have been underrepresented in VC. Venture Forward’s mission is to change that.
In 2022, Venture Forward’s Executive Director testified at a Congressional Hearing on the state of DEI in VC. Three new directors
were appointed to the Venture Forward board: Barry Eggers (Lightspeed), Samara Hernandez (Chingona Ventures), and Courtney
McCrea (Recast Capital.) The team also hired its third employee to serve as Marketing & Communications Director. To round out the
year, Venture Forward hosted its first-ever holiday party.
Venture Forward is funded solely through tax-deductible donations from individuals, VC firms, and corporate sponsors, including
SVB, Deloitte, and Gunderson Dettmer.
Ways To Engage With Venture Forward:

• Volunteer as a mentor or speaker for VC University.
• Volunteer to host LP Office Hours.
• Submit your firm’s DEI data via the VC Human Capital Survey.
• Make a tax-deductible donation to support this important work.
• Follow us on Twitter and LinkedIn.
• Sign up for our newsletter.
Maryam Haque Rhianon Anderson Sarah Mattina

Executive Director Senior Programs Marketing and
maryam@ Director Communications
ventureforward.org rhianon@ Director
ventureforward.org sarah@
ventureforward.org
44
Data provided by
Venture Forward in Action

Programs & Initiatives Recent Highlights What’s Ahead in 2023
VC University • Educated 2,350+ individuals across twelve • Educate 900+ individuals across three cohorts.
Created in partnership with NVCA and sold-out cohorts. • Continue hosting weekly office hours and
UC Berkeley in 2019, this industry-leading • Earned a net promoter score of 97%. monthly webinars.
certificate course offers a structured • Host monthly “Lunch & Learn” webinars with • Expand the support and resources offered to
introduction to the fundamentals of VC and is industry leaders. program alumni.
offered three times per year. The course consists • Host weekly office hours to support students • Expand the curriculum with new and
of self-paced lectures by industry experts and through the curriculum. updated content.
university faculty, live office hours, webinars, • Manage a Slack community for program
networking opportunities, and more. participants and alumni.
• Expanded course to offer additional life
science-specific content and added a life
science track to the scholarship program.
VC University Scholarship Program • Awarded 380+ full scholarships (across 12 • Award 120+ full scholarships across
VC University offers a robust scholarship program cohorts) to aspiring VCs from underrepresented three cohorts.
available by application to emerging VC investors backgrounds. • Continue to host scholarship office hours
from underrepresented and underestimated • Awarded 272 partial scholarships. for recipients.
backgrounds. Selected recipients receive full • Expanded the number of full scholarships • Continue to expand resources for
course tuition, supplemental office hours, access to available to each cohort from 10 to 40. scholarship alumni.
a curated mentorship program, and more. • Expanded the program to include a dedicated
Life Science Scholarship (LSS) track for aspiring
life science VCs.
• Expanded the program to include supplemental
office hours and a mentorship component.
VC University Mentorship Program • Matched 260+ VC University scholarship • Run the mentorship program three times,
In September 2020, the VC University recipients (across seven cohorts) with two VC supporting the scholarship recipients of each
scholarship program was expanded to include mentors each. VC University cohort.
a curated, three-month mentorship component. • Recruited 430+ VCs to volunteer as mentors, • Match 120+ scholarship recipients with two
Participating scholarship recipients are paired with approximately 40% returning to volunteer VC mentors according to shared professional
with two VCs: an experienced VC mentor (Partner across multiple programs. goals and experiences.
or equivalent with 5+ years’ investing experience) • Earned net promoter scores above 95% from all • Serve ~120 participants per program (~40
and a peer mentor (1-5 years’ experience). participants. mentees and 80 mentors.)
• Expand the support and resources offered to
participants.
VC Human Capital Survey • Published three editions of the survey and • Publish fourth edition of the survey, which
Powered by Venture Forward, NVCA, and Deloitte, interactive dashboard since 2016. includes data from 315 VC firms.
this biennial survey captures critical data about • Fielded fourth edition of the survey in 2H 2022.
the workforce at VC firms and offers guidance for
VC firms seeking to advance DEI.
LP Office Hours (LPOH) • Facilitated five in-person LP Office Hours • Hold two LP Office Hours events in-person and
These free, half-day workshops connect events in Palo Alto, Boston, Washington D.C., virtually.
emerging managers (EMs) from historically Los Angeles, and Chicago. • Convene 50 underrepresented EMs
underrepresented backgrounds with limited • Facilitated three virtual programs focused on to participate.
partners (LPs), general partners (GPs) with different LP types (fund of funds, foundations
significant fundraising experience, and industry and endowments, and family offices).
advisors. The “office hours” consist of highly • Served 200+ EMs from underrepresented
curated small-group roundtables and 1:1 backgrounds.
conversation between the EMs and the hosts.
Additional Programs and Initiatives • ESG in VC: Moving Beyond Talk to Action • Provide further education and resources
In addition to Venture Forward’s flagship • LGBTQ+ Investor Mixer to emerging GPs from underrepresented
initiatives, the organization produces various • SSBCI Resources backgrounds to help them successfully raise
events and educational programming to support and manage VC funds.
the VC community. • Connect our community of strong talent and VC
firms via job placement opportunities.
• Support VC firms in prioritizing and accelerating
45 DEI strategies within their organizations.
Data provided by
Appendix
Fund and Firm Analysis
Total Total Totoal Existing Firms that Raised AUM ($B) Average Average Median Median
Cumulative Cumulative Cumulative Funds Funds in the Last Fund Size Commitments Fund Size Commitments
Funds Firms Capital ($B) 8 Vintage Years ($M) + NAV ($M) ($M) + NAV ($M)
2004 2,344 1,022 $256.4 1,648 909 $161.3 $134.2 $157.9 $50.0 $52.9
2005 2,525 1,100 $278.9 1,659 969 $177.0 $138.1 $162.0 $50.0 $47.3
2006 2,724 1,162 $311.0 1,684 998 $197.3 $182.3 $166.3 $77.6 $45.4
2007 2,923 1,227 $344.2 1,616 987 $219.2 $184.4 $150.1 $100.0 $24.0
2008 3,130 1,295 $373.6 1,433 882 $224.3 $160.9 $138.6 $61.9 $17.0
2009 3,294 1,352 $391.7 1,370 861 $224.4 $137.3 $134.5 $44.7 $12.5
2010 3,467 1,423 $408.0 1,393 883 $233.3 $109.5 $135.0 $44.5 $11.9
2011 3,675 1,514 $432.9 1,489 939 $253.2 $150.3 $142.7 $40.0 $10.3
2012 3,987 1,652 $456.3 1,643 1,036 $255.2 $106.9 $130.8 $21.0 $7.8
2013 4,325 1,801 $478.7 1,800 1,132 $277.8 $85.9 $125.1 $26.0 $6.1
2014 4,815 2,041 $515.8 2,091 1,315 $308.6 $101.1 $124.2 $22.1 $6.2
2015 5,393 2,308 $559.0 2,470 1,521 $337.4 $95.0 $125.3 $20.0 $7.5
2016 6,031 2,581 $610.1 2,901 1,736 $357.0 $106.1 $133.7 $22.0 $10.4
2017 6,683 2,890 $654.7 3,389 2,007 $378.9 $91.7 $137.9 $25.0 $13.7
2018 7,458 3,226 $715.1 3,991 2,291 $458.4 $105.9 $155.8 $30.0 $17.7
2019 8,194 3,507 $786.0 4,519 2,515 $544.8 $120.9 $172.5 $34.2 $20.4
2020 9,063 3,792 $875.3 5,076 2,712 $694.0 $134.4 $206.4 $34.3 $22.8
2021 10,349 4,062 $1,030.5 6,024 2,889 $1,004.2 $149.4 $263.7 $30.0 $29.2
2022 11,133 4,064 $1,193.5 6,318 2,718 $1,115.7 $225.7 $291.6 $40.6 $33.3
46
Data provided by
Number of Active Investors

# of # of # of # of # of # of # of # of # of # of # of # of
Active Active Active Active VC Active Active Active US Active Active Active Active US Active US
Investors First- Life Investors VC First- VC Life Investors US First- US Life US VC VC First- VC Life
Round Science Round Science Round Science Investors Round Science
Investors Investors Investors Investors Investors Investors Investors Investors
2004 2,260 878 805 1,176 538 456 1,764 740 622 979 466 372
2005 2,444 1,045 823 1,211 560 473 1,899 842 622 1,041 490 381
2006 2,672 1,245 841 1,272 654 506 2,064 988 672 1,074 559 420
2007 3,201 1,481 1,018 1,441 722 573 2,458 1,165 801 1,234 629 474
2008 3,440 1,504 1,013 1,505 698 566 2,611 1,164 807 1,273 584 468
2009 3,016 1,302 895 1,334 572 508 2,251 1,010 712 1,121 502 435
2010 3,599 1,694 898 1,468 672 509 2,615 1,247 719 1,248 578 439
2011 4,821 2,494 1,025 1,694 890 549 3,196 1,710 816 1,422 761 478
2012 5,938 2,985 1,097 1,901 968 590 3,702 1,941 870 1,620 828 506
2013 7,866 3,768 1,321 2,161 1,121 620 4,339 2,191 1,002 1,848 972 519
2014 10,526 4,328 1,762 2,558 1,218 748 5,037 2,270 1,200 2,154 1,043 626
2015 11,354 4,221 2,010 2,882 1,312 835 5,342 2,184 1,288 2,371 1,101 695
2016 10,348 3,572 1,640 3,082 1,341 807 5,178 1,946 1,156 2,525 1,108 673
2017 10,977 3,667 2,012 3,594 1,657 1,010 5,563 2,094 1,391 2,888 1,353 820
2018 12,071 3,954 2,423 3,962 1,842 1,220 5,922 2,272 1,551 3,092 1,453 944
2019 13,306 4,406 2,538 4,302 1,971 1,266 6,396 2,433 1,663 3,374 1,586 1,005
2020 14,060 4,794 3,010 4,432 2,048 1,537 6,490 2,559 1,883 3,470 1,666 1,183
2021 19,117 7,403 3,626 5,490 2,868 1,803 8,156 3,365 2,246 4,128 2,172 1,348
2022 15,313 6,196 2,494 5,031 2,654 1,331 7,199 3,038 1,651 3,756 2,002 1,016

Note: VC investors include entities with primary investor type as: venture capital, corporate venture capital, or not-for-profit venture capital.
VC investors are headquartered globally, but only counted if they invested in a US company.
US as a % of Global VC Deal Activity

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Global Deal Value ($B) $38.4 $49.3 $67.4 $62.7 $76.0 $121.8 $180.1 $195.0 $208.4 $349.9 $326.7 $367.8 $739.1 $508.1
US Deal Value ($B) $27.9 $32.4 $45.7 $41.7 $50.1 $73.8 $86.4 $84.0 $90.0 $146.4 $149.3 $171.4 $345.4 $240.9
Global Deal Count (#) 7,394 9,654 12,222 14,601 18,771 23,674 29,474 30,053 32,188 35,952 37,253 38,208 51,601 44,491
US Deal Count (#) 4,604 5,586 6,950 8,092 10,036 11,084 11,870 10,829 11,730 12,410 13,513 13,359 18,620 16,464
US as % of Global ($) 73% 66% 68% 67% 66% 61% 48% 43% 43% 42% 46% 47% 47% 47%
US as % of Global (#) 62% 58% 57% 55% 53% 47% 40% 36% 36% 35% 36% 35% 36% 37%
47
Data provided by
Active Investor Count in 2022 Deals by Company HQ State
157 9 -
35
11
3 22
45 9
5 14
12 49 78
307
15
6 40
815
128 33 41 7
35 42 66
121 160
7 14 3
1,735 11 63 24
44
12 34 72
44 8 2
7
1 9 76
273
18
2
241
US as a % of Global VC Exit Activity

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Global Exit
$74.9 $96.5 $139.2 $101.4 $206.7 $136.4 $382.0 $191.1 $328.5 $358.4 $530.1 $1,436.9 $305.7
Value ($B)
US Exit Value ($B) $48.2 $67.5 $128.4 $74.9 $113.1 $77.4 $303.4 $102.2 $134.2 $249.7 $330.7 $764.1 $70.1
Global Exit Count 1,279 1,312 1,499 1,658 2,112 2,450 2,398 2,362 2,462 2,662 2,724 4,186 3,071
US Exit Count 746 763 897 939 1,132 1,121 1,026 1,088 1,259 1,305 1,249 1,934 1,240
US as % of
64% 70% 92% 74% 55% 57% 79% 53% 41% 70% 62% 53% 23%
Global Value
US as % of
58% 58% 60% 57% 54% 46% 43% 46% 51% 49% 46% 46% 40%
Global Count
48
Data provided by
Active Investor Count in 2022 Deals by Investor HQ State
79 3 -
35
4
2 32
21 6
8 10
18 57 803
254
11
9 49
70
155 27 51 6
28 46 46
103 50
10 27 2
1,701 20 54 43
60
10 34 56
24 11 8
11
1 8 74
220
17
-
210

Note: This map breaks out active VC investors by their HQ state. Note that active VC investors headquartered outside of the US are not included in this map.
US as a % of Global VC Fundraising by Year

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Global Capital
$39.8 $55.5 $59.0 $53.0 $84.2 $145.5 $187.4 $199.0 $305.3 $244.7 $230.2 $286.6 $256.1
Raised ($B)
US Capital
$16.2 $25.0 $23.4 $22.4 $37.1 $43.2 $51.0 $44.6 $60.4 $70.9 $89.4 $155.2 $163.0
Raised ($B)
Global Fund Count 492 600 666 736 1,123 1,377 1,603 1,628 1,746 1,679 1,736 1,513 1,513
US Fund Count 173 208 312 338 490 578 638 652 775 736 869 1,286 784
US as % of Global
41% 45% 40% 42% 44% 30% 27% 22% 20% 29% 39% 54% 64%
Value
US as % of Global
35% 35% 47% 46% 44% 42% 40% 40% 44% 44% 50% 85% 52%
Count
49
Data provided by
AUM by State in 2022
$19.7B $482.0M $3.7M

$2.1B
$2.9B $176.0M
$42.3M $1.4B $257.8M

$545.4M
$109.0B
$1.8B $4.6B $155.4B $102.5B
$589.8M
$117.6M
$2.9B $104.2M
$24.8B $3.5B $11.8B
$103.3M $3.8B $655.8M $2.3B
$6.2B $138.7M
$264.0M $2.5B $23.9M
$9.4B $7.7B
$103.1M
$479.1B
$2.9B $9.0B
$61.8M $3.4B
$327.5M
$730.4M $37.1M
$281.7M
- $5.1B
$244.1M
$16.9B
$94.7M
$121.3M
$7.9B
$48.4M
Top 5 States by AUM Distribution of Firms by AUM in 2022

in 2022 700
644
AUM ($B) 600
492
California $479,136.3 500 458
398
400 378
New York $155,420.1
300 271
Massachusetts $102,487.3
208
200 186
Illinois $24,821.6
100
Washington $19,723.5
0
Total $1,115.73 $0- $10- $25- $50- $100- $250- $500M- $1B+
$10M $25M $50M $100M $250M $500M $1B
50
Data provided by
AUM by State and Year ($M)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Alabama $126.9 $121.9 $138.4 $131.6 $91.3 $87.8 $83.6 $45.0 $51.4 $50.3
Arizona $95.1 $82.5 $79.7 $39.9 $54.7 $47.1 $19.3 $319.8 $369.4 $475.6
Arkansas - - - - - - - - - -
California $64,785.2 $71,300.9 $76,374.0 $68,787.2 $67,618.6 $71,161.8 $77,502.9 $87,160.4 $86,928.5 $90,910.8
Colorado $2,445.8 $2,264.1 $2,001.7 $1,186.5 $905.4 $947.1 $1,248.9 $1,200.0 $1,225.1 $1,676.3
Connecticut $6,393.7 $6,636.6 $6,050.3 $5,662.4 $3,723.9 $3,534.4 $3,803.6 $2,716.9 $2,320.8 $2,337.3
Delaware $37.7 $35.8 $47.4 $28.6 $12.3 $111.3 $123.9 $127.0 $138.4 $127.5
District of Columbia $1,450.6 $1,358.2 $1,238.6 $1,931.5 $1,504.6 $1,417.9 $1,444.8 $1,750.6 $1,910.8 $2,216.0
Florida $911.3 $1,459.2 $1,353.5 $1,435.6 $1,409.7 $1,402.5 $1,458.5 $1,712.1 $1,363.1 $1,463.9
Georgia $1,281.1 $1,239.7 $1,153.2 $984.1 $632.1 $658.5 $928.4 $900.6 $894.5 $1,020.9
Hawaii $31.3 $36.7 $32.8 $32.1 $32.9 $27.9 $14.8 $16.0 $7.4 $1.8
Idaho $24.0 $22.7 $22.1 $96.9 $131.2 $182.4 $194.5 $202.6 $202.4 $213.6
Illinois $2,658.1 $2,369.2 $2,618.7 $2,769.4 $3,169.3 $2,778.3 $2,968.9 $3,176.7 $3,214.7 $3,507.0
Indiana $303.4 $298.1 $275.5 $212.0 $126.9 $288.4 $289.0 $394.8 $399.5 $398.2
Iowa $35.2 $33.7 $32.0 $32.0 $34.2 $5.5 $5.3 $4.4 $7.4 $8.9
Kansas - - - - - - - $2.6 $2.6 $2.7
Kentucky $130.5 $144.5 $337.4 $344.3 $339.3 $216.4 $213.6 $243.4 $212.0 $42.0
Louisiana $407.1 $442.3 $488.0 $503.8 $512.4 $538.1 $573.5 $571.1 $307.3 $236.3
Maine $251.8 $242.5 $239.0 $299.2 $217.6 $197.9 $211.5 $255.7 $75.8 $85.6
Maryland $3,387.3 $3,218.0 $5,787.5 $5,694.1 $7,841.2 $7,332.7 $6,433.6 $7,222.8 $8,851.9 $7,075.5
Massachusetts $26,674.1 $30,220.9 $31,338.7 $30,309.6 $24,302.7 $24,027.9 $26,620.0 $29,570.0 $27,952.4 $28,510.0
Michigan $418.2 $584.6 $541.7 $502.0 $332.8 $548.3 $469.7 $782.8 $697.6 $761.1
Minnesota $530.7 $786.1 $1,155.7 $1,217.0 $1,668.8 $1,578.5 $1,508.5 $1,451.5 $1,436.2 $1,131.9
Missouri $1,277.5 $1,190.6 $1,078.1 $1,390.7 $692.1 $612.1 $658.7 $651.3 $574.3 $851.3
Montana - - $1.7 $1.7 $1.7 $1.6 $1.6 $1.6 $1.7 $1.5
Nebraska $27.7 $26.4 $25.4 - - - $2.6 $39.8 $39.4 $39.7
Nevada $52.7 $50.1 $37.1 - - - - - - -
New Hampshire $14.5 $14.4 $64.0 $74.7 $71.3 $58.1 $56.7 $58.7 $60.6 $76.4
New Jersey $2,824.6 $3,390.3 $4,275.7 $4,564.8 $3,986.5 $3,983.0 $3,664.9 $3,758.8 $3,403.6 $2,795.1
New Mexico $28.7 $47.3 $51.8 $54.0 $53.2 $49.3 $49.1 $59.2 $45.8 $12.3
New York $11,285.0 $12,471.4 $14,612.0 $14,489.2 $15,144.2 $15,077.7 $16,686.9 $20,634.0 $21,339.9 $22,739.9
North Carolina $834.9 $974.4 $1,264.6 $1,186.0 $1,059.1 $880.8 $712.0 $683.3 $539.2 $472.4
North Dakota - - - - - - - - - -
Ohio $973.6 $917.9 $842.4 $927.9 $992.0 $904.3 $1,015.0 $984.6 $1,019.2 $1,028.1
Oklahoma $47.7 $32.7 $4.0 $10.4 $10.2 $10.2 $10.5 $11.8 $20.5 $20.9
Oregon $89.1 $85.5 $83.1 $29.2 $29.3 $29.0 $45.0 $41.1 $55.8 $162.2
Pennsylvania $2,770.3 $2,734.7 $2,643.7 $2,333.2 $2,825.2 $2,709.0 $2,624.6 $2,671.9 $2,707.9 $2,889.6
Rhode Island - - - - - - - - $1.1 $1.1
South Carolina - $10.0 $9.9 $9.8 $9.8 $9.1 $8.8 $8.7 $8.6 $18.5
South Dakota - $9.9 $9.8 $9.8 $41.5 $40.2 $39.8 $56.2 $49.1 $49.8
Tennessee $570.5 $458.8 $362.0 $382.3 $336.4 $309.0 $362.4 $395.4 $331.8 $412.9
Texas $6,578.5 $7,250.0 $6,598.6 $5,458.6 $5,879.4 $4,987.9 $4,208.1 $4,964.8 $3,331.7 $4,357.2
Utah $469.0 $443.0 $558.8 $866.3 $975.8 $892.4 $766.9 $994.0 $991.0 $1,045.7
Vermont $15.4 $14.6 $14.2 $14.0 $15.1 $14.9 $15.2 $14.1 $95.1 $96.4
Virginia $1,723.0 $2,304.8 $2,416.0 $1,732.1 $1,942.7 $2,001.7 $2,456.0 $2,231.1 $1,823.0 $1,657.0
Washington $2,917.3 $3,323.5 $3,555.0 $5,126.9 $7,125.9 $6,591.6 $6,247.2 $6,059.5 $4,854.5 $4,834.2
Wisconsin $64.8 $62.3 $229.9 $200.4 $233.1 $220.2 $415.2 $471.9 $575.2 $584.1
Wyoming $17.6 $16.7 $16.1 - - - - - - -
51
Data provided by
AUM by State and Year ($M), continued

2014 2015 2016 2017 2018 2019 2020 2021 2022
Alabama $32.6 $74.7 $48.0 $51.5 $80.5 $85.7 $173.4 $214.5 $244.1
Arizona $654.7 $709.9 $755.6 $794.5 $929.6 $725.8 $706.3 $699.0 $730.4
Arkansas $10.4 $10.9 $162.7 $164.2 $176.4 $200.3 $230.0 $268.5 $327.5
California $103,582.7 $112,215.4 $130,508.1 $151,197.7 $193,864.8 $241,320.2 $309,686.1 $425,461.6 $479,136.3
Colorado $1,877.9 $2,119.3 $2,067.9 $2,423.9 $3,404.3 $3,783.8 $4,063.3 $5,299.2 $6,249.5
Connecticut $2,197.0 $2,154.6 $2,448.3 $3,030.5 $3,375.2 $3,565.5 $5,990.8 $9,100.6 $11,751.6
Delaware $145.9 $160.1 $170.5 $51.7 $38.4 $107.8 $112.4 $145.7 $138.7
District of Columbia $2,386.2 $1,888.6 $2,129.7 $2,650.5 $2,924.6 $3,745.6 $5,417.1 $5,890.0 $7,663.0
Florida $1,535.5 $1,749.0 $1,684.3 $1,626.1 $1,788.3 $2,145.2 $3,668.8 $5,372.8 $7,897.3
Georgia $969.5 $956.8 $900.2 $953.6 $794.8 $1,985.5 $2,191.9 $3,735.1 $5,147.3
Hawaii $11.7 $12.1 $10.4 $31.3 $34.5 $39.8 $47.5 $48.1 $48.4
Idaho $128.2 $128.1 $46.4 $19.2 $21.0 $72.0 $82.7 $103.5 $109.0
Illinois $3,478.6 $4,215.2 $5,075.4 $5,755.0 $8,905.7 $10,772.7 $15,730.3 $21,683.5 $24,821.6
Indiana $421.3 $454.2 $443.6 $270.3 $418.6 $206.9 $197.5 $574.3 $655.8
Iowa $9.9 $6.9 $55.8 $58.2 $75.3 $184.8 $239.2 $577.1 $589.8
Kansas $3.0 $3.6 $3.4 $30.1 $73.0 $97.9 $175.6 $252.5 $264.0
Kentucky $11.5 $20.5 $21.1 $20.9 $42.9 $35.7 $76.7 $98.9 $103.1
Louisiana $219.7 $167.2 $84.3 $22.1 $27.4 $34.9 $81.1 $87.1 $94.7
Maine $10.1 $132.8 $135.6 $149.9 $156.7 $184.0 $198.6 $218.1 $257.8
Maryland $8,215.9 $11,806.0 $9,345.9 $10,349.2 $10,462.5 $8,104.4 $9,394.4 $10,744.8 $9,028.2
Massachusetts $25,857.7 $30,016.2 $34,079.5 $35,032.5 $39,687.5 $49,502.5 $67,720.2 $99,483.3 $102,487.3
Michigan $872.5 $1,267.6 $2,342.1 $2,480.3 $2,702.8 $2,974.1 $3,830.6 $4,917.0 $4,584.1
Minnesota $1,021.8 $701.9 $504.8 $636.3 $802.1 $1,161.9 $1,324.8 $2,743.4 $2,907.9
Missouri $830.7 $628.2 $920.9 $1,230.8 $1,455.0 $1,793.6 $1,882.5 $2,377.7 $2,482.8
Montana - - $21.0 $24.3 $65.1 $94.2 $105.4 $475.4 $482.0
Nebraska $42.2 $69.0 $69.0 $98.0 $101.4 $62.4 $68.1 $108.9 $117.6
Nevada - $42.6 $41.9 $49.0 $53.5 $59.2 $68.4 $98.7 $103.3
New Hampshire $35.6 $32.4 $45.5 $94.4 $269.5 $538.6 $722.5 $1,911.6 $2,072.5
New Jersey $2,015.8 $2,112.9 $2,247.3 $1,470.5 $1,644.4 $1,495.0 $1,529.2 $2,023.0 $2,270.6
New Mexico $21.8 $21.2 $31.2 $34.4 $38.1 $31.2 $35.6 $34.1 $37.1
New York $28,874.2 $33,146.5 $35,397.2 $38,001.2 $47,613.7 $54,331.5 $74,078.0 $121,330.2 $155,420.1
North Carolina $457.1 $366.5 $605.2 $771.2 $877.3 $1,065.6 $1,194.3 $3,045.2 $3,425.3
North Dakota $3.5 $3.5 $3.6 $5.6 $6.4 $7.4 $8.4 $11.4 $3.7
Ohio $1,398.3 $1,059.3 $1,466.3 $1,426.1 $1,590.7 $2,414.5 $2,661.5 $3,321.5 $3,486.0
Oklahoma $22.9 $26.0 $28.1 $29.4 $30.6 $33.4 $35.3 $62.1 $61.8
Oregon $212.3 $228.1 $256.1 $320.4 $366.6 $411.9 $352.2 $509.8 $545.4
Pennsylvania $2,497.9 $2,086.4 $1,902.9 $1,666.7 $1,600.9 $2,161.7 $2,416.5 $2,765.0 $2,914.4
Rhode Island $1.2 $1.7 $1.9 $2.0 $2.0 $2.1 $0.5 $100.7 $104.2
South Carolina $26.2 $37.1 $45.4 $55.7 $65.0 $76.6 $70.7 $77.7 $281.7
South Dakota $52.4 $56.1 $21.4 $19.3 $1.0 $1.0 - - -
Tennessee $464.7 $360.5 $634.5 $719.3 $909.8 $1,100.6 $1,471.0 $1,850.0 $2,939.2
Texas $4,588.1 $4,012.0 $4,070.9 $5,219.6 $7,318.6 $8,122.4 $8,976.5 $14,979.5 $16,884.6
Utah $1,097.4 $1,184.2 $1,310.8 $1,251.5 $1,592.6 $2,081.2 $2,964.3 $3,557.7 $3,791.1
Vermont $110.6 $124.6 $123.9 $194.9 $195.1 $222.3 $126.6 $163.7 $176.0
Virginia $1,945.0 $2,464.6 $2,980.4 $3,021.8 $4,001.0 $4,725.1 $5,670.9 $8,995.4 $9,354.4
Washington $4,412.1 $3,824.8 $3,599.5 $4,511.8 $8,153.3 $9,444.8 $13,013.3 $17,782.8 $19,723.5
Wisconsin $586.1 $644.5 $570.7 $485.3 $695.5 $826.5 $889.7 $1,423.9 $1,442.1
Wyoming - $20.9 $21.2 $22.8 $25.2 $68.0 $172.4 $1,732.6 $1,766.8
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Data provided by
Data Methodology
Fundraising Stage Definitions Venture growth: Rounds are generally
classified as Series E or later (which
we typically aggregate together as
We define venture capital funds as Angel/seed: We define financings as
venture growth) either by the series of
pools of capital raised for the purpose angel rounds if there are no PE or VC
stock issued in the financing or, if that
of investing in the equity of startup firms involved in the company to date
information is unavailable, by a series of
companies. In addition to funds raised and we cannot determine if any PE or
factors, including the age of the company,
by traditional venture capital firms, VC firms are participating. In addition,
number of VC rounds, company status,
PitchBook also includes funds raised if there is a press release that states the
and participating investors.
by any institution with the primary round is an angel round, it is classified
intent stated above. Funds identifying as such. Finally, if a news story or press
Corporate venture capital: Financings
as growth-stage vehicles are classified release only mentions individuals making
classified as corporate venture capital
as PE funds and are not included in this investments in a financing, it is also
include rounds that saw both firms
report. A fund’s location is determined classified as angel. As for seed, when the
investing via established CVC arms or
by the country in which the fund is investors and/or press release state that
corporations making equity investments
domiciled, if that information is not a round is a seed financing, or it is for
off balance sheets or whatever other
explicitly known, the HQ country of the less than $500,000 and is the first round
non-CVC method was actually employed.
fund’s general partner is used. Only funds as reported by a government filing, it is
based in the United States that have classified as such. If angels are the only
held their final close are included in the investors, then a round is only marked as Exits
fundraising numbers. The entirety of a seed if it is explicitly stated.
fund’s committed capital is attributed We include the first majority liquidity
to the year of the final close of the fund. Early-stage: Rounds are generally event for holders of equity securities of
Interim close amounts are not recorded in classified as Series A or B (which we venture-backed companies. This includes
the year of the interim close. typically aggregate together as early- events where there is a public market
stage) either by the series of stock issued for the shares (IPO) or the acquisition of
Deals in the financing or, if that information majority of the equity by another entity
(corporate or financial acquisition). In
is unavailable, by a series of factors
including the age of the company, prior addition, special purpose acquisition
We include equity investments into
financing history, company status, companies (SPAC) registration is broken
startup companies from an outside
participating investors, and more. out, but only completed SPACs wherein
source. Investment does not necessarily
the reverse merger is completed between
have to be taken from an institutional
Late-stage: Rounds are generally the public SPAC and a privately held
investor. This can include investment
classified as Series C or D or later (which company are included in total exit value
from individual angel investors, angel
we typically aggregate together as late and volume calculations. This does
groups, seed funds, venture capital firms,
stage) either by the series of stock issued not include secondary sales, further
corporate venture firms, and corporate
in the financing or, if that information sales after the initial liquidity event, or
investors. Investments received as part of
is unavailable, by a series of factors bankruptcies. M&A value is based on
an accelerator program are not included;
including: the age of the company, prior reported or disclosed figures, with no
however, if the accelerator continues to
financing history, company status, estimation used to assess the value of
invest in follow-on rounds, those further
participating investors, and more. transactions for which the actual deal
financings are included. All financings are
size is unknown.
of companies headquartered in the US.
53
Data provided by
Glossary
The following definitions are graciously provided by the Center for Private Equity and Venture Capital at the Tuck School of
Business at Dartmouth. Used by permission. NVCA and PitchBook are grateful to the Center for its support.
“A” round (“Series A”) – formerly the returns are adjusted for the risk of the ASC Topic 820 – FASB Accounting
first “institutional” capital raised by a manager’s portfolio relative to the risk of Standards Codification (ASC) Topic
Company, the “A” round is now typically the benchmark index. Alpha is a proxy for 820 (formerly known as FAS 157) is
the second institutional round of manager skill. the accounting standard that dictates
financing for a young company where how to measure and disclose fair value
venture capitalists are sufficiently Alternative asset class – a class of for financial reporting purposes. FASB
interested in a company to invest a larger investments that includes venture capital, ASC Topic 946 (Investment Companies)
amount of capital after the “Seed” round leverage buyouts, hedge funds, real dictates that all investments should be
to fund the company to the next stage of estate, and oil and gas, but excludes reported at fair value.
its development. Subsequent rounds of publicly traded securities. Pension plans,
financing are called “B,” “C,” “D,” etc. college endowments and other relatively “B” round (“Series B”) – a financing event
large institutional investors typically whereby venture capital investors who
Accredited investor – a person or legal allocate a certain percentage of their are sufficiently interested in a company
entity, such as a company or trust investments to alternative assets with an provide a next round of funding after
fund, that meets certain net worth and objective to diversify their portfolios. the “A” round of financing. Subsequent
income qualifications and is considered rounds are called “C,” “D,” and so on.
to be sufficiently sophisticated to make American Investment Council (AIC) – an
investment decisions in private offerings. advocacy, communications and research Basis point (“bp”) – one one-hundredth
Regulation D of the Securities Act of organization for the private equity (1/100) of a percentage unit. For example,
1933 exempts accredited investors from industry in the United States. Previously 50 basis points equals one half of one
protection of the Securities Act. The known as Private Equity Growth Capital percent. Banks quote variable loan rates
Securities and Exchange Commission Council (PEGCC). in terms of an index plus a margin and the
has proposed revisions to the accredited margin is often described in basis points,
investor qualifying rules, which may or Angel – a wealthy individual who invests such as LIBOR plus 400 basis points (or,
may not result in changes for venture in companies in relatively early stages as the experts say, “bips”).
investors. The current criteria for a of development.
natural person are: $1 million net Beta – a measure of volatility of a public
worth (excluding the value of a primary Angel Groups – groups of individual stock relative to an index or a composite
residence) or annual income exceeding angels who invest together, individually of all stocks in a market or geographical
$200,000 individually or $300,000 with or through a pooled vehicle, enabling region. A beta of more than one indicates
a spouse. Directors, general partners them to share deal flow with each other. the stock has higher volatility than the
and executive officers of the issuer are index (or composite) and a beta of one
considered to be accredited investors. Anti-dilution – a contract clause that indicates volatility equivalent to the index
See Rule 501 of Regulation D of the SEC protects an investor from a substantial (or composite). For example, the price of
for current details. reduction in percentage ownership in a stock with a beta of 1.5 will change by
a company due to the issuance by the 1.5% if the index value changes by 1%.
Alpha – a term derived from statistics company of additional shares to other Typically, the S&P 500 index is used in
and finance theory that is used to entities. The mechanism for making an calculating the beta of a stock.
describe the return produced by a fund adjustment that maintains the same
manager in excess of the return of a percentage ownership is called a Full Beta product – a product that is
benchmark index. Manager returns and Ratchet. The most commonly used being tested by potential customers
benchmark returns are measured net of adjustment provides partial protection prior to being formally launched into
the risk-free rate. In addition, manager and is called Weighted Average. the marketplace.
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Data provided by
Blockchain – a distributed ledger that all common stock outstanding on a fully Capital Asset Pricing Model (CAPM) – a
uses advanced cryptography to create diluted basis (including all convertible method of estimating the cost of equity
a “chain” of “blocks” of information that securities, warrants and options) in capital of a company. The cost of equity
are unalterable and verifiable. Useful for the denominator of the formula for capital is equal to the return of a risk-free
recording any number of transactions determining the new weighted average investment plus a premium that reflects
or sets of data in a verifiable way that is price. See Narrow-based weighted the risk of the company’s equity.
extremely difficult to modify. average anti-dilution.
Capital call – when a private equity fund
Blank Check Company – See SPAC. Burn rate – the rate at which a startup manager (usually a “general partner” in
uses available cash to cover expenses in a partnership) requests that an investor
Board of directors – a group of excess of revenue. Usually expressed on a in the fund (a “limited partner”) provide
individuals, typically composed of monthly or weekly basis. previously committed capital. Usually a
managers, investors and experts who limited partner will agree to a maximum
have a fiduciary responsibility for the Business Development Company (BDC) investment amount and the general
well-being and proper guidance of a – a publicly traded company that invests partner will make a series of capital
corporation. The board is typically elected in private companies and is required by calls over time to the limited partner as
by the shareholders. law to provide meaningful support and opportunities arise to finance startups
assistance to its portfolio companies. and buyouts.
Book – see Private placement
memorandum. Business plan – a document that Capital gap – the difficulty faced by
describes a new concept for a business some entrepreneurs in trying to raise
Bootstrapping – the actions of a startup opportunity. A business plan typically between $2 million and $5 million.
to minimize expenses and build cash flow, includes the following sections: executive Friends, family and angel investors are
thereby reducing or eliminating the need summary, market need, solution, typically good sources for financing
for outside investors. technology, competition, marketing, rounds of less than $2 million, while many
management, operations, exit strategy, venture capital funds have become so
Bp – see Basis point. and financials (including cash flow large that investments in this size range
projections). For most venture capital are difficult.
Bridge financing – temporary funding funds, fewer than 10 of every 100
that will eventually be replaced by business plans eventually receive funding. Capitalization table (or Cap Table) – a
permanent capital from equity investors table showing the owners of a company’s
or debt lenders. In venture capital, a Buyout – a sector of the private equity shares and their ownership percentages
bridge is usually a short-term note (6 to industry. Also, the purchase of a as well as the debt holders. It also lists
12 months) that converts to preferred controlling interest of a company by an the forms of ownership, such as common
stock. Typically, the bridge lender has outside investor using substantial debt stock, preferred stock, warrants, options,
the right to convert the note to preferred (in a leveraged buyout) or a management senior debt, and subordinated debt.
stock at a price that is a 20% to 25% team (in a management buyout).
discount from the price of the preferred Capital gains – a tax classification of
stock in the next financing round. See Buy-sell agreement – a contract that investment earnings resulting from the
Mezzanine and Wipeout bridge. sets forth the conditions under which purchase and sale of assets. Typically, a
a shareholder must first offer his or her company’s investors and founders have
Broad-based weighted average anti- shares for sale to the other shareholders earnings classified as long-term capital
dilution – A weighted average anti- before being allowed to sell to entities gains (held for a year or longer), which
dilution method adjusts downward the outside the company. are often taxed at a lower rate than
price per share of the preferred stock of ordinary income.
investor A due to the issuance of new C Corporation – an ownership structure
preferred shares to new investor B at that allows any number of individuals Capital stock – a description of stock
a price lower than the price investor A or companies to own shares. A C that applies when there is only one
originally received. Investor A’s preferred corporation is a stand-alone legal entity class of shares. This class is known as
stock is repriced to a weighted average of so it offers some protection to its owners, “common stock.”
investor A’s price and investor B’s price. managers and investors from liability
A broad-based anti-dilution method uses resulting from its actions.
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Data provided by
Capital Under Management – A Closing – the conclusion of a financing Consolidation – see Rollup.
frequently used metric for sizing total round whereby all necessary legal
funds managed by a venture capital or documents are signed and capital has Conversion – the right of an investor or
private equity firm. In practice, there are been transferred. lender to force a company to replace
several ways of calculating this. In the the investor’s preferred shares or the
US, this is the total committed capital Co-investment – the direct investment lender’s debt with common shares at
for all funds managed by a firm on by a limited partner alongside a general a preset conversion ratio. A conversion
which it collects management fees. This partner in a portfolio company. feature was first used in railroad bonds in
calculation ignores whether portions of the 1800’s.
the committed capital have not yet been Collateral – hard assets of the borrower,
called and whether portions of the fund such as real estate or equipment, for Convertible debt – a loan that allows
have been liquidated and distributed. It which a lender has a legal interest until a the lender to exchange the debt for
typically does not include aging funds in loan obligation is fully paid off. common shares in a company at a
their “out years” on which fees are not preset conversion ratio. Also known as a
being collected. For purposes of this book Commitment – an obligation, typically “convertible note.”
in calculating capital managed, because the maximum amount that a limited
direct data is not available, the last eight partner agrees to invest in a fund. See Convertible preferred stock – a type
vintage years of capital commitments is Capital call. of stock that gives an owner the right
considered a proxy for the industry’s total to convert preferred shares to common
capital under management. Common stock – a type of security shares of stock. Usually, preferred stock
representing ownership rights in a has certain rights that common stock
Capped participating preferred company. Usually, company founders, doesn’t have, such as decision-making
stock – preferred stock whose management and employees own management control, a promised return
participating feature is limited so that common stock while outside investors on investment (dividend), or senior
an investor cannot receive more than own preferred stock. In the event of a priority in receiving proceeds from a sale
a specified amount. See Participating liquidation of the company, the claims or liquidation of the company. Typically,
preferred stock. of secured and unsecured creditors, convertible preferred stock automatically
bondholders and preferred stockholders converts to common stock if the company
Carried interest capital gains – the share take precedence over common makes an initial public offering (IPO).
in the capital gains of a venture capital stockholders. See Preferred stock. Convertible preferred is the most common
fund that is allocated to the General tool for private equity funds to invest
Partner. Typically, a fund must return Comparable – a private or public in companies.
the capital given to it by limited partners company with similar characteristics
plus any preferential rate of return before to a private or public company Co-sale right – a contractual right of
the general partner can share in the that is being valued. For example, an investor to sell some of the investor’s
profits of the fund. The general partner a telecommunications equipment stock along with the founder’s or majority
will typically receive a 20% carried manufacturer whose market value is 2 shareholder’s stock if either the founder
interest, although some successful firms times revenues can be used to estimate or majority shareholder elects to sell
receive 25%-30%. Also known as “carry” the value of a similar and relatively new stock to a third-party. Also known as
or “promote.” company with a new product in the same Tag-along right.
industry. See Liquidity discount.
Clawback – a clause in the agreement Cost of capital – see weighted average
between the general partner and the Control – the authority of an individual cost of capital (WACC).
limited partners of a private equity or entity that owns more than 50%
fund. The clawback gives limited of equity in a company or owns the Cost of revenue – the expenses
partners the right to reclaim a portion largest block of shares compared to generated by the core operations
of disbursements to a general partner other shareholders. Control can also be delivering the product or services of
for profitable investments based on granted through special voting rights a company.
significant losses from later investments and protective provisions in a company’s
in a portfolio. organizing documents.
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Data provided by
Covenant – a legal promise to do or Deal flow – a measure of the number of without the use of intermediaries such as
not do a certain thing. For example, potential investments that a fund reviews investment banks, broker-dealers, and
in a financing arrangement, company in any given period. underwriters as would be the case in an
management may agree to a negative IPO. Cutting out the intermediaries from a
covenant, whereby it promises not to Defined benefit plan – a company public offering materially lowers the cost
incur additional debt. The penalties for retirement plan in which the benefits of a public offering. Spotify completed the
violation of a covenant may vary from are typically based on an employee’s first-ever Direct Listing on the NYSE on
repairing the mistake to losing control of salary and number of years worked. April 3, 2018.
the company. Fixed benefits are paid after the
employee retires. The employer bears Direct secondary transaction – a
Coverage ratio – describes a company’s the investment risk and is committed to transaction in which the buyer purchases
ability to pay debt from cash flow or providing the benefits to the employee. shares of an operating company from an
profits. Typical measures are EBITDA/ Defined benefit plan managers can invest existing seller. While the transaction is a
Interest, (EBITDA minus Capital in private equity funds. secondary sale of shares, the transacted
Expenditures)/Interest, and EBIT/Interest. interest is a primary issue purchase
Defined contribution plan – a company directly into an operating company.
Cram down round – a financing retirement plan in which the employee Sellers are often venture capitalists
event upon which new investors with elects to contribute some portion of his selling their ownership stake in a portfolio
substantial capital are able to demand or her salary into a retirement plan, such company. Buyers are often funds that
and receive contractual terms that as a 401(k) or 403(b). The employer specialize in such investments.
effectively cause the issuance of may also contribute to the employee’s
sufficient new shares by the startup plan. With this type of plan, the Discount rate – the interest rate used to
company to significantly reduce employee bears the investment risk. The determine the present value of a series of
(“dilute”) the ownership percentage of benefits depend solely on the amount future cash flows.
previous investors. of money made from investing the
employee’s contributions. Discounted cash flow (DCF) – a
Cryptocurrency – a natively-digital valuation methodology whereby the
currency using encryption techniques to Demand rights – a type of registration present value of all future cash flows
regulate the creation of units of currency right. Demand rights give an investor expected from a company or investment
and verify transfer of funds. Usually the right to force a startup to register its is calculated.
created and managed independently of a shares with the SEC and prepare for a
central bank. public sale of stock (IPO). Distressed debt – the bonds of a
company that is either in or approaching
Cumulative dividends – the owner Dilution – the reduction in the ownership bankruptcy. Some private equity
of preferred stock with cumulative percentage of current investors, founders funds specialize in purchasing such
dividends has the right to receive accrued and employees caused by the issuance debt at deep discounts with the
(previously unpaid) dividends in full of new shares (for example to investors expectation of exerting influence in the
before dividends are paid to any other in follow on rounds, employees by restructuring of the company and then
classes of stock. increasing the stock option pool, debt selling the debt once the company has
providers in the form or warrants, etc.). meaningfully recovered.
Current ratio – the ratio of current assets
to current liabilities. Dilution protection – see Anti-dilution Distribution – the transfer of cash or
and Full ratchet. securities to a limited partner resulting
Data room – a specific location where from the sale, liquidation or IPO of one
potential buyers / investors can review Direct Listing – also known as a DPO or more portfolio companies in which a
confidential information about a target (Direct Public Offering), a Direct Listing general partner chose to invest.
company. This information may include is a listing on an exchange, such as the
detailed financial statements, client NYSE or NASDAQ, where a company Dividends – payments made
contracts, intellectual property, property offers its securities directly to the public by a company to the owners of
leases, and compensation agreements. and self-underwrites its securities certain securities.
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Data provided by
Down round – a round of financing Earnings before interest, taxes, Exit strategy – the plan for generating
whereby the valuation of the company depreciation, and amortization profits for owners and investors of a
is lower than the value determined by (EBITDA) – a measurement of the company. Typically, the options are to
investors in an earlier round. cash flow of a company. One possible merge, be acquired, or make an initial
valuation methodology is based on public offering (IPO). An alternative is to
DPO (Direct Public Offering) – see a comparison of private and public recapitalize (releverage the company and
Direct Listing companies’ value as a multiple then pay dividends to shareholders).
of EBITDA.
Drag-along rights – the contractual Expansion stage – the stage of a
right of an investor in a company to force Earn out – an arrangement in which company characterized by a complete
all other investors to agree to a specific sellers of a business receive additional management team and a substantial
action, such as the sale of the company. future payments, usually based on increase in revenues.
financial performance metrics such as
Drawdown schedule – an estimate revenue or net income. Fair value – a financial reporting principle
of the gradual transfer of committed for valuing assets and liabilities, for
investment funds from the limited Elevator pitch – a concise presentation, example, portfolio companies in venture
partners of a private equity fund to the lasting only a few minutes (an elevator capital fund portfolios. In 2007, more
general partners. ride), by an entrepreneur to a potential defined rules took effect. See ASC
investor about an investment opportunity. Topic 820.
Due diligence – the investigatory process
performed by investors to assess the Employee Stock Ownership Fairness opinion – a letter issued by an
viability of a potential investment and the Program (ESOP) – a plan established investment bank that charges a fee to
accuracy of the information provided by by a company to reserve shares assess the fairness of a negotiated price
the target company. for employees. for a merger or acquisition.
Dutch auction – a method of conducting Entrepreneur – an individual who starts FAS 157 – see ASC Topic 820 entry.
an IPO whereby newly issued shares their own business.
of stock are committed to the highest First refusal – the right of a privately
bidder, then, if any shares remain, to the Entrepreneurship – the application of owned company to purchase any shares
next highest bidder, and so on until all innovative leadership to limited resources that employees would like to sell before
the shares are committed. Note that the in order to create exceptional value. they are offered to outside buyers.
price per share paid by all buyers is the
price commitment of the buyer of the Enterprise Value (EV) – the sum of the Founders stock – nominally priced
last share. market values of the common stock and common stock issued to founders,
long-term debt of a company, minus officers, employees, directors,
Early stage – the state of a company excess cash. and consultants.
after the seed (formation) stage but
before middle stage (generating Equity – the ownership structure of a Free cash flow to equity (FCFE) – the
revenues). Typically, a company in early company represented by common shares, cash flow available after operating
stage will have a core management team preferred shares, or unit interests. Equity expenses, interest payments on debt,
and a proven concept or product, but no = Assets - Liabilities. taxes, net principal repayments,
positive cash flow. preferred stock dividends, reinvestment
ESOP – see Employee Stock needs, and changes in working capital.
Earnings before interest and taxes Ownership Program. In a discounted cash flow model to
(EBIT) – a measurement of the operating determine the value of the equity of a firm
profit of a company. One possible Evergreen fund – a fund that reinvests its using FCFE, the discount rate used is the
valuation methodology is based on profits in order to ensure the availability cost of equity.
a comparison of private and public of capital for future investments.
companies’ value as a multiple of EBIT.
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Data provided by
Free cash flow to the firm (FCFF) – the Fund-of-funds – a fund created to invest Growth stage – the stage of a company
operating cash flow available after in other funds (e.g. VC Funds, PE funds, when it has received one or more rounds
operating expenses, taxes, reinvestment etc.). Typically, individual investors and of financing and is generating revenue
needs, and changes in working capital, relatively small institutional investors from its product or service. Also known
but before any interest payments on participate in a fund-of-funds to minimize as “middle stage.”
debt are made. In a discounted cash flow their portfolio management efforts and
model to determine the enterprise value leverage the size and scale of the fund- Hart-Scott-Rodino (HSR) Act – a law
of a firm using FCFF, the discount rate of-funds. requiring entities that acquire certain
used is the weighted average cost of amounts of stock or assets of a company
capital (WACC). Gatekeepers – intermediaries which to inform the Federal Trade Commission
endowments, pension funds, and other and the Department of Justice and
Friends and family financing – capital institutional investors use as advisors to observe a waiting period before
provided by the friends and family of regarding private equity investments. completing the transaction to allow the
founders of an early-stage company. agencies to assess whether there will be
Friends and family financings may also General partner (GP) – a class of partner any anti-competitive implications as a
include individual angel investors known in a partnership. The general partner result of the transaction.
to or introduced to the founders. Friends retains liability for the actions of the
and family financing rounds are typically partnership. Historically, venture capital Hedge fund – an investment fund that
structured as notes convertible into a and buyout funds have been structured has the ability to use leverage, take short
Seed or Series A round of financing. as limited partnerships, with the venture positions in securities, or use a variety of
Founders should be careful not to firm as the GP and limited partners derivative instruments in order to achieve
create an ownership structure that may (LPs) being the institutional and high net a return that is relatively less correlated
hinder the participation of professional worth investors that provide most of the to the performance of typical indices
investors once the company begins to capital in the partnership. The GP earns (such as the S&P 500) than traditional
achieve success. a management fee and a percentage of long-only funds. Hedge fund managers
gains (see Carried interest). are typically compensated based on
Full ratchet – an anti-dilution protection assets under management as well as
mechanism to protect earlier investors GP – see General partner. fund performance.
from dilution when a new round is
raised at a lower price. In the case of a GP for hire – in a spin-out or a synthetic High yield debt – debt issued via public
full ratchet for a Series A followed by secondary, a GP for hire refers to the offering or public placement (Rule 144A)
a Series B at a lower price per share, professional investor who may be hired that is rated below investment grade
additional shares would be issued to by a purchasing firm to manage the by S&P or Moody’s. This means that the
the Series A preferred investors so that new fund created from the orphaned debt is rated below the top four rating
their resulting cost per share is equal to assets purchased. In past cases, the GP categories (i.e. S&P BB+, Moody’s Ba2 or
the price per share paid by the Series B has often expanded its role to fundraise below). The lower rating is indicative of
preferred investors. Often as a result of for and run new funds alongside the higher risk of default, and therefore the
the implementation of a ratchet, company initial fund. debt carries a higher coupon or yield than
management and employees who own investment grade debt. Also referred
a fixed number of common shares suffer Going-private transaction – when a to as Junk bonds or Sub-investment
significant dilution. See Narrow-based public company chooses to pay off all grade debt.
weighted average anti-dilution and public investors, delist from all stock
Broad-based weighted average anti- exchanges, and become owned by Hockey stick – the general shape
dilution. management, employees, and select and form of a chart showing revenue,
private investors. customers, cash, or some other financial
Fully diluted basis – a methodology or operational measure that increases
for calculating any per share ratios Golden handcuffs – financial incentives dramatically at some point in the future.
whereby the denominator is the total that discourage founders and/or Entrepreneurs often develop business
number of shares, both preferred and important employees from leaving a plans with hockey stick charts to impress
common, issued by the company on the company before a predetermined date or potential investors.
assumption that all warrants and options important milestone.
are exercised.
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Holding period – amount of time an In-kind distribution – a distribution to capital industry and has published
investment remains in a portfolio. limited partners of a private equity fund guidelines for applying US GAAP and
that is in the form of publicly traded international IFRS valuation rules.
Hot issue – stock in an initial public shares rather than cash. See www.privateequityvaluation.
offering that is in high demand. com. Widely regarded in the US as the
Inside round – a round of financing global successor to the US-focused
Hot money – capital from investors that in which the investors are the same PEIGG group.
have no tolerance for lack of results investors as the previous round. An
by the investment manager and move inside round raises liability issues since IPO – see Initial public offering.
quickly to withdraw at the first sign the valuation of the company has no
of trouble. third-party verification in the form of an IRR – see Internal rate of return.
outside investor. In addition, the terms
Hurdle rate – a minimum rate of return of the inside round may be considered J curve – a concept that during the first
required before an investor will make self-dealing if they are onerous to any set few years of a private equity fund, cash
an investment. of shareholders or if the investors give flow or returns are negative due to
themselves additional preferential rights. investments, losses, and expenses, but as
Incorporation – the process by which investments produce results the cash flow
a business receives a state charter, Institutional investor – professional or returns trend upward. A graph of cash
allowing it to become a corporation. entities that invest capital on behalf of flow or returns versus time would then
Many corporations choose Delaware companies or individuals. Examples are resemble the letter “J.”
because its laws are business-friendly pension plans, insurance companies, and
and up to date. university endowments. Later stage – the state of a company
that has proven its concept, achieved
Incubator – a company or facility Intellectual property (IP) – knowledge, significant revenues compared to its
designed to host startup companies. techniques, writings, and images that are competition, and is approaching cash
Incubators help startups grow intangible but often protected by law via flow break even or positive net income.
while controlling costs by offering patents, copyrights, and trademarks. Typically, a later stage company is about
networks of contacts and shared back 6 to 12 months away from a liquidity
office resources. Interest coverage ratio – earnings event such as an IPO or buyout. The rate
before interest and taxes (EBIT) divided of return for venture capitalists that invest
Indenture – the terms and conditions by interest expense. This is a key ratio in later stage, less risky ventures is lower
between a bond issuer and bond buyers. used by lenders to assess the ability of than in earlier stage ventures.
a company to produce sufficient cash to
Initial coin offering (ICO) – an offering of service its debt obligation. LBO – see Leveraged buyout.
units of a new cryptocurrency or crypto-
token, usually in exchange for existing Internal rate of return (IRR) – the interest Lead investor – the outside investor
cryptocurrencies such as Bitcoin or Ether, rate at which a certain amount of capital that makes the largest investment in
as a presale against a future blockchain today would have to be invested in order a financing round and manages the
project, i.e., the new coins or tokens sold to grow to a specific value at a specific documentation and closing of that
will be the “currency” for transactions in a time in the future. round. The lead investor sets the price
new or future blockchain project. per share of the financing round, thereby
Investment thesis/Investment determining the valuation of the company.
Initial public offering (IPO) – the first philosophy – the fundamental ideas
offering of stock by a company to the which determine the types of investments Letter of intent – a document confirming
public. New public offerings must be that an investment fund will choose in the intent of an investor to participate
registered with the Securities and order to achieve its financial goals. in a round of financing for a company.
Exchange Commission. An IPO is one By signing this document, the subject
of the methods that a startup that has IPEV – stands for International Private company agrees to begin the legal and
achieved significant success can use Equity Valuation guidelines group. This due diligence process prior to the closing
to raise additional capital for further group is made up of representatives of the transaction. Also known as a
growth. See Qualified IPO. of the international and US venture “Term Sheet.”
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Leverage – the use of debt to acquire various limited partners. The general the shares of a private company sell
assets, build operations, and increase partner manages the investments and is their shares in exchange for cash,
revenues. By using debt, a company is liable for the actions of the partnership in the case of an IPO or cash-based
attempting to achieve results faster than while the limited partners are generally M&A transaction, or shares of an
if it only used its cash available from pre- protected from legal actions and any acquiring company.
leverage operations. The risk is that the losses beyond their original investment.
increase in assets and revenues does not The general partner collects a Lock-up agreement – investors,
generate sufficient net income and cash management fee and earns a percentage management, and employees often
flow to pay the interest costs of the debt. of capital gains (see Carried interest), agree not to sell their shares for a specific
while the limited partners receive income, time period after an IPO, usually 6 to
Leveraged buyout (LBO) – the purchase capital gains, and tax benefits. 12 months. By avoiding large sales of
of a company or a business unit of a its stock, the company has time to build
company by an outside investor using Limited partner (LP) – an investor in a interest among potential buyers of
mostly borrowed capital. limited partnership. The general partner its shares.
is liable for the actions of the partnership
Leveraged recapitalization – the while the limited partners are generally London Interbank Offered Rate
reorganization of a company’s capital protected from legal actions and any (L.I.B.O.R.) – the average rate charged
structure resulting in more debt added to losses beyond their original investment. by large banks in London for loans to
the balance sheet. Private equity funds The limited partner receives income, each other. LIBOR is a relatively volatile
can recapitalize a portfolio company capital gains, and tax benefits. rate and is typically quoted in maturities
and then direct the company to issue a of one month, three months, six months,
one-time dividend to equity investors. Liquidation – the sale of a company. This and one year.
This is often done when the company is may occur in the context of an acquisition
performing well financially and the debt by a larger company or in the context of Management buyout (MBO) – a
markets are expanding. selling off all assets prior to cessation leveraged buyout controlled by the
of operations (Chapter 7 bankruptcy). In members of the management team
Leverage ratios – measurements of a a liquidation, the claims of secured and of a company or a division. Often an
company’s debt as a multiple of cash unsecured creditors, bondholders, and MBO is conducted in partnership with a
flow. Typical leverage ratios include preferred stockholders take precedence buyout fund.
Total Debt/EBITDA, Total Debt/(EBITDA over common stockholders.
minus Capital Expenditures), and Senior Management fee – a fee charged to the
Debt EBITDA. Liquidation preference – the contractual limited partners in a fund by the general
right of an investor to priority in receiving partner. Management fees in a private
L.I.B.O.R. – see The London Interbank the proceeds from the liquidation of a equity fund usually range from 0.75%
Offered Rate. company. For example, a venture capital to 3% of capital under management,
investor with a “2x liquidation preference” depending on the type and size of fund.
License – a contract in which a patent has the right to receive two times its For venture capital funds, 2% is typical.
owner grants to a company the right original investment upon liquidation
to make, use, or sell an invention before other more junior forms of equity Management rights – the rights often
under certain circumstances and share in the liquidation proceeds. required by a venture capitalist as
for compensation. part of the agreement to invest in a
Liquidity discount – a decrease in the company. The venture capitalist has
Limited liability company (LLC) – an value of a private company compared to the right to consult with management
ownership structure designed to limit the the value of a similar but publicly traded on key operational issues, attend board
founders’ losses to the amount of their company. Since an investor in a private meetings, and review information about
investment. An LLC itself does not pay company cannot readily sell his or her the company’s financial situation.
taxes, rather its owners pay taxes on investment, the shares in the private
their proportion of the LLC profits at their company must be valued less than a Market capitalization – the value of a
individual tax rates. comparable public company. publicly traded company as determined
by multiplying the number of shares
Limited partnership – a legal entity Liquidity event – a transaction whereby outstanding by the current price
composed of a general partner and owners of a significant portion of per share.
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MBO – see Management buyout. American companies that will fuel the NVCA – see National Venture Capital
economy of tomorrow. As the voice Association.
Mezzanine – a layer of financing that of the US venture capital and startup
has intermediate priority (seniority) in community, NVCA advocates for public Offering memorandum – a legal
the capital structure of a company. For policy that supports the American document that provides details of an
example, mezzanine debt has lower entrepreneurial ecosystem. Serving the investment to potential investors. See
priority than senior debt but usually has venture community as the preeminent Private placement memorandum.
a higher interest rate and often includes trade association, NVCA arms the
warrants. In venture capital, a mezzanine venture community for success, serving Operating cash flow – the cash flow
round is generally the round of financing as the leading resource for venture produced from the operation of a
that is designed to help a company have capital data, practical education, peer-led business, not from investing activities
enough resources to reach an IPO. See initiatives, and networking. (such as selling assets) or financing
Bridge financing. activities (such as issuing debt).
NDA – see Non-disclosure agreement. Calculated as net operating income (NOI)
Multiples – a valuation methodology that plus depreciation.
compares public and private companies Non-cumulative dividends – dividends
in terms of a ratio of value to an that are payable to owners of preferred Option pool – a group of options set
operations figure such as revenue or net stock at a specific point in time only if aside for long term, phased compensation
income. For example, if several publicly there is sufficient cash flow available to management and employees.
traded computer hardware companies after all company expenses have been
are valued at approximately 2 times paid. If cash flow is insufficient, the Outstanding shares – the total amount
revenues, then it is reasonable to assume owners of the preferred stock will not of common shares of a company, not
that a startup computer hardware receive the dividends owed for that time including treasury stock, convertible
company that is growing fast has the period and will have to wait until the preferred stock, warrants, and options.
potential to achieve a valuation of 2 times board of directors declares another set
its revenues. Before the startup company of dividends. Pay to play – a clause in a financing
issues its IPO, it will likely be valued at agreement whereby any investor that
less than 2 times revenue because of Non-disclosure agreement (NDA) – an does not participate in a future round
the lack of liquidity of its shares. See agreement issued by entrepreneurs to agrees to suffer significant dilution
Liquidity discount. protect the privacy of their ideas when compared to other investors. The most
disclosing those ideas to third parties. onerous version of “pay to play” is
Narrow-based weighted average automatic conversion to common shares,
anti-dilution – a type of anti-dilution Non-interference – an agreement often which in essence ends any preferential
mechanism. A weighted average anti- signed by employees and management rights of an investor.
dilution method adjusts downward the whereby they agree not to interfere
price per share of the preferred stock with the company’s relationships with Pari passu – a legal term referring to the
of investor A (by issuing new additional employees, clients, suppliers, and sub- equal treatment of two or more parties
shares) due to the issuance of new contractors within a certain time period in an agreement. For example, a venture
preferred shares to new investor B at after termination of employment. capitalist may agree to have registration
a price lower than the price investor A rights that are pari passu with the other
originally received. Investor A is issued No-shop clause – a section of an investors in a financing round.
enough preferred stock to replicate a agreement to purchase or invest in a
weighed average of investor A’s price company whereby the seller agrees Participating dividends – the right of
and investor B’s price. A narrow-based not to market the company to other holders of certain preferred stock to
anti-dilution uses only common stock potential buyers or investors for a specific receive dividends and participate in
outstanding in the denominator of time period. additional distributions of cash, stock, or
the formula for determining the new other assets.
weighted average price. Non-solicitation – an agreement often
signed by employees and management Participating preferred stock – a unit
National Venture Capital Association whereby they agree not to solicit other of ownership composed of preferred
(NVCA) – the trade organization that employees of the company regarding stock and common stock. The preferred
empowers the next generation of job opportunities. stock entitles the owner to receive a
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predetermined sum of cash (usually investment was made). As a result, the and investor expectations for company
the original investment plus accrued startup will have a post-money valuation progress before a Seed round has
dividends) if the company is sold or has of $7 million. increased. Pre-Seed rounds can be priced
an IPO. The common stock represents rounds or can be structured as notes
additional continued ownership in PPM – see Private placement convertible into a “Series Seed” financing
the company. memorandum. round. The size of Pre-Seed rounds can
often be similar to the size of Seed rounds
PEIGG – acronym for Private Equity Preemptive rights – the rights only a few years ago.
Industry Guidelines Group, an ad hoc of shareholders to maintain their
group of individuals and firms involved percentage ownership of a company by Pre-Seed stage – the state of a company
in the private equity industry for the buying shares sold by the company in when it has just been incorporated and
purpose of establishing valuation future financing rounds. its founders are developing their product
and reporting guidelines. With the or service.
implementation of FAS 157 in 2007, the Preference – seniority, usually with
group’s mission was essentially complete. respect to dividends and proceeds from a Primary shares – shares sold by
Several of its members then joined sale or dissolution of a company. a corporation (not by individual
IPEV, which is viewed by US VCs as the shareholders).
international successor to PEIGG. Preferred return – a minimum return per
annum that must be generated for limited Private Equity Growth Capital Council
Piggyback rights – rights of an investor partners of a private equity fund before (PEGCC) – See American Investment
to have his or her shares included in the general partner can begin receiving a Council (AIC).
a registration of a startup’s shares in percentage of profits from investments.
preparation for an IPO. Private equity – equity investments in
Preferred stock – a type of stock that non-public companies, usually defined as
PIK dividend – a dividend paid to the has certain rights that common stock being made up of venture capital, growth
holder of a stock, usually preferred stock, does not have. These special rights may equity, and buyout funds. Real estate, oil
in the form of additional stock rather than include dividends, participation, liquidity and gas, and other such partnerships are
cash. PIK refers to payment in kind. preference, anti-dilution protection, sometimes included in the definition.
and veto provisions, among others.
PIPEs – see Private investment in Private equity investors usually purchase Private investment in public equity
public equity. preferred stock when they make (PIPEs) – investments by a private equity
investments in companies. fund in a publicly traded company,
Placement agent – a company that usually at a discount and in the form of
specializes in finding institutional Pre-money valuation – the valuation preferred stock.
investors that are willing and able of a company prior to the current round
to invest in a private equity fund. of financing. For example, a venture Private placement – the sale of a
Sometimes a private equity fund will hire capitalist may invest $5 million in a security directly to a limited number of
a placement agent so the fund partners company valued at $2 million pre-money. institutional and qualified individual
can focus on making and managing As a result, the startup will have a “pre- investors. If structured correctly, a private
investments in companies rather than on money” valuation of $2 million. placement avoids registration with the
raising capital. Securities and Exchange Commission.
Pre-Seed round (“Series Pre-Seed”) – a
Portfolio company – a company that has financing event whereby angels, angel Private placement memorandum (PPM)
received an investment from a private groups, professionally managed Seed – a document explaining the details of
equity fund. funds, and early stage venture capital an investment to potential investors.
funds become involved in a young start- For example, a private equity fund will
Post-money valuation – the valuation of up company that was previously financed issue a PPM when it is raising capital
a company including the capital provided by founders, their friends and family, and from institutional investors. Also, a
by the current round of financing. For individual angel investors in a friends and startup may issue a PPM when it needs
example, a venture capitalist may family financing. Pre-Seed rounds are growth capital. Also known as “Offering
invest $5 million in a company valued uncommon but have begun to emerge as Memorandum.”
at $2 million “pre-money” (before the Seed rounds have grown larger in size
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Private securities – securities that are and may even negotiate a right to receive Rolling fund – a new type of investment
not registered with the Securities and an additional sum in excess of the vehicle, structured as a series of
Exchange Commission and do not trade original investment. limited partnerships, which allows fund
on any exchanges. The price per share managers to share deal flow with fund
is negotiated between the buyer and the Registration – the process whereby investors on a quarterly subscription
seller (the “issuer”). shares of a company are registered with basis while netting carried interest
the Securities and Exchange Commission over a multi-year period. With this
Qualified IPO – a public offering under the Securities Act of 1933 in fund structure, funds are open to new
of securities valued at or above a preparation for a sale of the shares to investors every quarter vs. only being
total amount specified in a financing the public. open when a new fund is closed.
agreement. This amount is usually
specified to be sufficiently large to Regulation D – often referred to as Rollup – the purchase of relatively smaller
guarantee that the IPO shares will trade simply “Reg D,” an SEC regulation that companies in a sector by a rapidly
in a major exchange (NASDAQ or New governs private placements. Private growing company in the same sector. The
York Stock Exchange). Usually upon a placements are investment offerings for strategy is to create economies of scale.
qualified IPO, preferred stock is forced to institutional and accredited individual For example, the movie theater industry
convert to common stock. investors, but not the general public. underwent significant consolidation via
rollups in the 1960’s and 1970’s.
Quartile – one fourth of the data points in Restricted shares – shares that cannot
a data set. Often, private equity investors be traded in the public markets. Round – a financing event usually
are measured by the results of their involving several private equity investors.
investments during a particular period Return on investment (ROI) – the
of time. Institutional investors often proceeds from an investment, during Royalties – payments made to patent or
prefer to invest in private equity funds a specific time period, calculated as a copyright owners in exchange for the use
that demonstrate consistent results over percentage of the original investment. of their intellectual property.
time, placing in the upper quartile of the Also, net profit after taxes divided by
investment results for all funds. average total assets. Rule 144 – a rule of the Securities and
Exchange Commission that specifies
Realization ratio – the ratio of cumulative Rights offering – an offering of stock to the conditions under which the
distributions to paid-in capital. The current shareholders that entitles them to holder of shares acquired in a private
realization ratio is used as a measure of purchase the new issue. transaction may sell those shares in the
the distributions from investment results public markets.
of a private equity partnership compared Rights of co-sale with founders – a
to the capital under management. clause in venture capital investment S corporation – an ownership structure
agreements that allows the VC fund to that limits its number of owners to 100.
Recapitalization – the reorganization of a sell shares at the same time that the An S corporation does not pay taxes.
company’s capital structure. founders of a startup choose to sell. Rather, its owners pay taxes on their
proportion of the corporation’s profits at
Red herring – a preliminary prospectus Risk-free rate – a term used in finance their individual tax rates.
filed with the Securities and Exchange theory to describe the return from
Commission and containing the details investing in a riskless security. In practice, SBIC – see Small Business Investment
of an IPO offering. The name refers to this is often taken to be the return on US Company.
the disclosure warning printed in red Treasury Bills.
letters on the cover of each preliminary SPV (Special Purpose Vehicle) – an
prospectus advising potential investors of Road show – presentations made in entity created by an investor, or by
the risks involved. several cities to potential investors and private equity or venture capital fund
other interested parties. For example, a management company, to invest in one
Redemption rights – the right of an company will often make a road show company, or a small group of companies.
investor to force the startup company to to generate interest among institutional In the case of an individual investor, an
buy back the shares issued as a result of investors prior to its IPO. SPV enables that investor to raise capital
the investment. In effect, the investor has to invest in one company or one small
the right to take back his/her investment ROI – see Return on investment. group of companies without forming
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a fund management company and partners in a limited partnership as the Seed stage – formerly, the state of
raising a traditional fund. In the case of fund increases its investment activities a company when it has just been
private equity and venture capital fund over time. incorporated and its founders are
management companies, an SPV is often developing their product or service. More
used to put more capital into a portfolio Secondary market – a market for the typically today, the stage of a company
company or a small group of companies sale of limited partnership interests following material product development
than would be prudent for the fund itself in private equity funds. Sometimes and often commercial launch, but before
given diversification requirements and limited partners choose to sell their raising larger amounts of capital for
portfolio concentration limits. SPVs interest in a partnership, typically to investments in growth.
raised by private equity and venture raise cash or because they cannot meet
capital funds will typically have lower their obligation to invest more capital Senior debt – a loan that has a higher
management fees and carried interest according to the takedown schedule. priority in case of a liquidation of the
than the main funds. Certain investment companies specialize asset or company.
in buying these partnership interests at
SPAC (Special Purpose Acquisition a discount. Seniority – higher priority.
Company) – a company with no
commercial operations formed strictly Secondary shares – shares sold by a Series A preferred stock – preferred
to raise capital through an IPO for shareholder (not by the corporation). stock issued by a fast growth company
the purpose of acquiring an existing in exchange for capital from investors in
company. Also known as “blank check Securities and Exchange Commission the “A” round of financing. This preferred
companies,” SPACs have been used (SEC) – the regulatory body that enforces stock is usually convertible to common
for decades, but until recently were federal securities laws such as the shares upon an IPO.
generally used for acquisitions of small Securities Act of 1933 and the Securities
companies. In recent years, however, Exchange Act of 1934. Shareholder agreement – a contract that
SPACs, have become extremely popular, sets out the basis on which the company
attracting high profile executives, private Seed capital – investment provided by will be operated and the shareholders’
equity firms, and underwriters. In 2020, professional seed funds, angels and rights and obligations. It provides
SPACs raised more than $84B, a six-fold angel groups, and friends and family rights and privileges to preferred and
increase from a record-setting year just of the founders of a startup in the seed major shareholders and protections to
one year earlier in 2019, and accounted stage of its development. minority shareholders.
for over one-half of all IPO volume for
the year. Seed round (“Series Seed”) – a financing Sharpe Ratio – a method of calculating
event whereby angels, angel groups, the risk-adjusted return of an investment.
Scalability – a characteristic of a new professionally managed Seed funds, The Sharpe Ratio is calculated by
business concept that entails the growth and early stage venture capital funds subtracting the risk-free rate from the
of sales and revenues with a much slower become involved in a young start-up return on a specific investment for
growth of organizational complexity company that was previously financed a time period (usually one year) and
and expenses. Venture capitalists look by founders, their friends and family, and then dividing the resulting figure by
for scalability in the startups they select individual angel investors in a friends the standard deviation of the historical
to finance. and family financing. Seed rounds can (annual) returns for that investment. The
be priced rounds or can be structured higher the Sharpe Ratio, the better.
Scale-down – a schedule for phased as notes convertible into a “Series A”
decreases in management fees for financing round. The Seed round is now Small Business Investment Company
general partners in a limited partnership typically the first “institutional” financing (SBIC) – a company licensed by the
as the fund reduces its investment of a company, although Pre-Seed rounds Small Business Administration to receive
activities toward the end of its term. have begun to emerge drawing earlier government capital in the form of debt or
institutional capital (See Pre-Seed equity for use in private equity investing.
Scale-up – the process of a company round.) The size of Seed rounds in recent
growing quickly while maintaining years has grown to resemble what Stock option – a right to purchase or
operational and financial controls in formerly would have been a small “Series sell a share of stock at a specific price
place. Also, a schedule for phased A” round. within a specific period of time. Stock
increases in management fees for general
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purchase options are commonly used Tender offer – an offer to public discounted by a certain interest rate
as long term incentive compensation shareholders of a company to purchase and adjusted for future anticipated
for employees and management of fast their shares. dilution in order to determine the current
growth companies. value. Usually, discount rates for the
Term loan – a bank loan for a specific venture capital method are considerably
Strategic investor – a relatively large period of time, usually up to ten years in higher than public stock return rates,
corporation that agrees to invest in a leveraged buyout structures. representing the fact that venture
young or a smaller company in order to capitalists must achieve significant
have access to its proprietary technology, Term sheet – a document confirming returns on investment in order to
product, or service. the intent of an investor to participate compensate for the risks they take in
in a round of financing for a company. funding unproven companies.
Subordinated debt – a loan that has a By signing this document, the subject
lower priority than a senior loan in case company agrees to begin the legal and Venture Monitor – officially known as
of a liquidation of the asset or company. due diligence process prior to the closing the PitchBook-National Venture Capital
Also known as “junior debt.” of the transaction. Also known as “Letter Association (NVCA) Venture Monitor.
of Intent.” Jointly produced by PitchBook and NVCA,
Sweat equity – ownership of shares in a it serves as the authoritative quarterly
company resulting primarily from work Tranche – a portion of a set of securities. report on venture capital activity in the
rather than investment of capital. Each tranche may have different rights or entrepreneurial ecosystem. The Venture
risk characteristics. When venture capital Monitor provides a complete look at
Syndicate – a group of investors that firms finance a company, a round may venture capital activity, reporting on
agree to participate in a round of funding be disbursed in two or three tranches, fundraising, investments, exits, and
for a company. Alternatively, a syndicate each of which is paid when the company other relevant industry analysis in one
can refer to a group of investment banks attains one or more milestones. comprehensive report each quarter.
that agree to participate in the sale of
stock to the public as part of an IPO. Turnaround – a process performed Vesting – a schedule by which employees
at a struggling company resulting in gain ownership over time of a previously
Synthetic secondary – a popular a substantial increase in a company’s agreed upon amount of retirement
method of completing a direct secondary revenues, profits, and reputation. funding or stock options.
transaction in which the buyer becomes
a limited partner (LP) in a special purpose Under water option – an option is said to Vintage – the year that a private equity
vehicle (SPV) or similar entity that be under water if the current fair market fund begins making investments. Venture
has been set up out of the underlying value of a stock is less than the option funds are generally benchmarked to funds
investments in order to create a limited exercise price. of the same vintage year.
partnership interest. The term arose
because of the synthetic nature of Underwriter – an investment bank that Voting rights – the rights of holders
the direct purchase through the LP chooses to be responsible for the process of preferred and common stock in a
secondary transaction. of selling new securities to the public. company to vote on certain acts affecting
An underwriter usually chooses to work the company. These matters may include
Tag-along right – the right of a minority with a syndicate of investment banks payment of dividends, issuance of a new
investor to receive the same benefits in order to maximize the distribution of class of stock, mergers, or liquidation.
as a majority investor. Usually applies the securities.
to a sale of securities by investors. Also Warrant – a security which gives the
known as Co-sale right. Venture capital – a segment of the private holder the right to purchase shares in a
equity industry which focuses on investing company at a pre-determined price. A
Takedown – a schedule of the transfer in new companies with high growth warrant is a long-term option, usually
of capital in phases in order to complete potential and accompanying high risk. valid for several years or indefinitely.
a commitment of funds. Typically, a Typically, warrants are issued
takedown is used by a general partner of Venture capital method – a pricing concurrently with preferred stocks or
a private equity fund to plan the transfer valuation method whereby an estimate bonds in order to increase the appeal of
of capital from the limited partners. of the future value of a company is the stocks or bonds to potential investors.
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Washout round – a financing round Write-down – a decrease in the reported

whereby previous investors, the founders, value of an asset or a company.
and management suffer significant
dilution. Usually as a result of a washout Write-off – a decrease in the reported
round, the new investor gains majority value of an asset or a company to zero.
ownership and control of the company.
Write-up – an increase in the reported
Weighted average cost of capital value of an asset or a company.
(WACC) – the average of the cost of
equity and the after-tax cost of debt. Zombie – a company that has received
This average is determined using weight capital from investors but has only
factors based on the ratio of equity to generated sufficient revenues and cash
debt plus equity and the ratio of debt to flow to maintain its operations without
debt plus equity. significant growth. Sometimes referred
to as “walking dead.” Typically, a venture
Weighted average anti-dilution – an capitalist has to make a difficult decision
anti-dilution protection mechanism as to whether to liquidate a zombie or
whereby the conversion rate of preferred continue to invest funds in the hopes that
stock is adjusted in order to reduce an the zombie will become a winner.
investor’s loss due to an increase in the
number of shares in a company. Without
anti-dilution protection, an investor
would suffer from a reduction of his
or her percentage ownership. Usually
as a result of the implementation of a
weighted average anti-dilution, company
management and employees who own
a fixed number of common shares suffer
significant dilution, but not as badly as in
the case of a full ratchet.
67
Data provided by
Geographic
Definitions
US regions
West Coast – Alaska, California, Hawaii, Great Lakes – Illinois, Indiana, Michigan, South – Arkansas, Kentucky, Louisiana,
Oregon, Washington Minnesota, Ohio, Wisconsin Oklahoma, Tennessee, Texas
Mountain – Arizona, Colorado, Idaho, New England – Connecticut, Maine, Southeast – Alabama, Florida, Georgia,
Montana, Nevada, New Mexico, Massachusetts, New Hampshire, Rhode Mississippi, North Carolina, Puerto Rico,
Utah, Wyoming Island, Vermont South Carolina
Midwest – Iowa, Kansas, Missouri, Mid-Atlantic – Delaware, DC, Maryland,

Nebraska, North Dakota, South Dakota New Jersey, New York, Pennsylvania,
Virginia, West Virginia
New
England
West Coast
Midwest
Great Lakes
Mountain
Mid-Atlantic
South Southeast
68
Data provided by
Industry Code
Definitions
Example companies in these definitions do not necessarily mean that those companies are included in the venture dataset included
in the Yearbook, but are merely provided for context.
Description VC Special Industry Description VC Special Industry
Commercial Services Commercial Services Construction (Nonwood) Other
Consumer Goods & Containers and Packaging Other

Apparel and Accessories
Recreation
Forestry Other
Consumer Goods &
Restaurants, Hotels and Leisure
Recreation Metals, Minerals and Mining Other
Consumer Goods &
Retail Textiles Other
Recreation
Energy Equipment Energy Other Materials Other
Exploration, Production and Refining Energy Utilities Other
Energy Services Energy Other Energy Other
Healthcare Devices and Supplies HC Devices & Supplies Capital Markets/Institutions Other
Healthcare Services HC Services & Systems Commercial Banks Other
Healthcare Technology Systems HC Services & Systems Insurance Other
Communications and Networking IT Hardware Other Financial Services Other
Computer Hardware IT Hardware Services (Non-Financial) Other
Semiconductors IT Hardware Transportation Other
Media Media Other Consumer Products and Services Other
Commercial Products Other Consumer Durables Other
Other Healthcare Other Consumer Non-Durables Other
IT Services Other Commercial Transportation Other
Other Information Technology Other Other Business Products and Services Other
Agriculture Other Pharmaceuticals and Biotechnology Pharma & Biotech
Chemicals and Gases Other Software Software
Note: Life sciences is composed of pharma & biotech and healthcare devices & supplies combined.
69
Data provided by
1 Business Products & Services Ex: Accenture, Sitel, ARAMARK Ex: Arbitron, DST Systems, Interactive Data
Corporation
1.1 Commercial Products 1.2.3 Construction and Engineering - Companies
engaged in large scale or non-residential 1.2.11 Office Services - Providers of administrative,
1.1.1 Aerospace and Defense - Manufacturers of construction. Includes building construction, heavy/ office management, and personnel services.
equipment, parts or products related to civil or highway construction, industrial construction,
military aerospace and defense. Includes aircraft architecture, and civil engineering, among others. Ex: Express Personnel Services, IKON Office
parts, firearms, and other munitions. Solutions, Snelling Personnel Services
Ex: Turner Construction, Skanska, Tishman
Ex: Boeing, Lockheed Martin, Northrop Grumman Construction 1.2.12 Printing Services - Providers of commercial
printing services. Includes printing, copying,
1.1.2 Building Products - Manufacturers and 1.2.4 Consulting Services - Providers of specialized binding, and document preparation, among others.
distributors of home improvement and construction consulting services to improve a company’s
products and equipment. Includes drills, saws, performance. Includes environmental consulting, Ex: Kinko’s, AlphaGraphics, Sir Speedy
windows, doors, and other prefabricated building human resource consulting, management
materials, among others. consulting, strategic consulting, and political 1.2.13 Security Services - Provider of residential
consulting, among others. and commercial security services. Includes security
Ex: USG, Elk Corporation, Fastenal Company system installation, monitoring, and staffing
Ex: McKinsey and Company, Boston Consulting services, among others.
1.1.3 Distributors/Wholesale - Companies engaged Group, Watson Wyatt
in the sale of bulk goods for resale by a retailer. Ex: Brinks, AlliedBarton Security Services,
The goods are sold to industrial, commercial, 1.2.5 Education and Training Services - Providers Protection One
institutional, or other entities. of specialized education and training services.
Includes on-the-job and off-the-job training, among 1.2.14 Other Commercial Services
Ex: Ferguson Enterprises, W.W. Grainger, Hughes others.
Supply 1.3 Transportation
Ex: Apollo Group, Accredited Technical Training,
1.1.4 Electrical Equipment - Manufacturers of WorldWideLearn 1.3.1 Air - Providers of products or services related
electrical equipment and components. Includes to commercial air transportation. Includes couriers,
a broad range of electrical devices, electrical 1.2.6 Environmental Services - Providers of airfreight, and airplane maintenance, among
components, power-generating equipment, and environmental services. Includes environmental others.
other large electrical systems, among others. management, waste management, and pollution
control services, among others. Ex: Delta Cargo, Pilot Freight Services, Lufthansa
Ex: AO Smith, Exide Technologies, Zoltek Companies Cargo
Ex: Environmental Quality Management, Waste
1.1.5 Industrial Supplies and Parts - Manufacturers Management, Allied Waste Industries 1.3.2 Marine - Providers of products or services
of intermediate goods. Includes industrial parts and related to commercial water transportation.
supplies made through injection molding, extrusion, 1.2.7 Human Capital Services - Providers of human Includes cargo shipping, manufacturers of ships,
thermoforming, die casting, and metal stamping, resource and employment services. Includes and ship components, among others.
among others. recruitment, training, and career development,
among others. Ex: Overseas Shipholding Group, DryShips, Seacor
Ex: Advanced Plastics, Precision Urethane and Holdings
Machine, Lyons Tool and Die Ex: Monster Worldwide, Vault.com, Robert Half
Finance and Accounting 1.3.3 Rail - Providers of products or services related
1.1.6 Machinery - Manufacturers of heavy-duty to commercial rail transportation. Includes freight
industrial machinery. Includes heavy equipment, 1.2.8 Legal Services - Providers of corporate legal trains, manufacturers of trains, and train parts,
hardware, and machine tools, among others. services. Includes contract law, tax law, securities among others.
law, intellectual property rights, and zoning law,
Ex: Caterpillar, Komatsu, Deere and Company among others. Ex: Union Pacific, Canadian National Railway,
Norfolk Southern
1.1.7 Other Commercial Products Ex: DLA Piper, Goodwin Procter, White and Case
1.3.4 Road - Providers of products or services
1.2 Commercial Services 1.2.9 Logistics - Providers of supply chain related to commercial land transportation. Includes
management and logistical support. Includes freight trucks, manufacturers of commercial trucks,
1.2.1 Accounting, Audit and Tax Services - Providers inventory management, purchasing, organizing and truck parts, among others.
of accounting, audit, and tax services to managers, transportation, and warehousing, among others.
investors, and tax authorities. Ex: J.B. Hunt Transport Services, Landstar System,
Ex: Penske Logistics, United Parcel Service, Con-way
Ex: PricewaterhouseCoopers, Ernst and Young, Expeditors International
KPMG, Deloitte 1.3.5 Infrastructure - Providers of products
1.2.10 Media and Information Services - Providers and services for commercial transportation
1.2.2 BPO/Outsource Services - Providers of of media and information services to businesses. infrastructure. Includes products and services
business process outsourcing (BPO) services. BPO Includes companies engaged in trade shows, related to airports, train stations, bus terminals, and
is the transmission of processes and operational marketing, branding, conducting surveys, market highway construction, among others.
activities to a third party for the purpose of cost analysis, and audience data interpretations, among
reduction, productivity growth, and innovative others. This includes online marketplaces. Ex: Hubbard Construction, Granite Construction,
capabilities. Mosites Construction
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Data provided by
1.3.6 Other Transportation Ex: Samsung, Sony, Panasonic Ex: Bloomberg, Interactive Data Corporation, Gallup
1.4 Other Business Products and Services 2.2.3 Home Furnishings - Manufacturers of home 2.4.3 Movies, Music and Entertainment - Companies
furniture and other decorative accessories. Includes engaged in the production, distribution, and sale
1.4.1 Buildings and Property - Owners of buildings couches, lamps, and draperies, among others. of entertainment products and services. Includes
and property. Includes office buildings, factories, movie theaters, production companies, and music
farmland, and oil fields, among others. Ex: Ethan Allen Interior, Furniture Brands labels, among others.
International, La-Z-Boy
Ex: The Empire State Building, 175 Fifth Avenue Ex: Lowes Cineplex, Virgin Records, Paramount
2.2.4 Household Appliances - Manufacturers Pictures
1.4.2 Conglomerates - Companies engaged in of household appliances. Includes microwaves,
multiple and unrelated industrial sectors. vacuum cleaners, washers, and dryers, among 2.4.4 Publishing - Providers of print and internet
others. publishing services. Includes newspapers,
Ex: Berkshire Hathaway, Altria Group, GE magazines, and books, among others.
Ex: Whirlpool, Kenmore, LG
1.4.3 Government - Providers of products and Ex: Daily Journal, The New York Times Company,
services to government agencies. Includes 2.2.5 Recreational Goods - Manufacturers of The McGraw-Hill Companies
consulting, information technology services, and recreational goods. Includes sporting goods and
military equipment and support, among others. leisure goods, among others. 2.4.5 Social Content - Owners and operators of
social content websites. Includes social networks,
Ex: Booz Allen Hamilton, Maximus, Skanska Ex: Burton, Titleist, Coleman discussion boards, and dating websites, among
others.
1.4.4 Other Business Products and Services 2.2.6 Other Consumer Durables
Ex: Facebook, LinkedIn, Match.com
2 Consumer Products & Services 2.3 Consumer Non-Durables
2.4.6 Other Media
2.1 Apparel and Accessories 2.3.1 Beverages - Producers and distributors of
alcoholic and non-alcoholic beverages. 2.5 Restaurants, Hotels and Leisure
2.1.1 Accessories - Manufacturers or designers
of fashion accessories. Includes jewelry, gloves, Ex: Coca-Cola, Pepsi, Anheuser-Busch 2.5.1 Casinos and Gaming - Owners and operators
handbags, hats, belts, scarves, and sunglasses, of casinos and other gaming operations.
among others. 2.3.2 Food Products - Producers, processors, and
distributors of food products. Includes companies Ex: MGM Mirage, Boyd Gaming, Monarch Casino
Ex: Ray-Ban, Coach, Citizen Watch Company engaged in food preparation, and manufacturers of
packaged food, among others. 2.5.2 Cruise Lines - Owners and operators of cruise
2.1.2 Clothing - Manufacturers or designers of lines. Includes cruise ships, and ocean liners, among
clothing. Ex: Kraft Foods, Heinz, Lancaster Colony others.
Ex: Ralph Lauren Polo, Hanes, Columbia Sportswear 2.3.3 Household Products - Manufacturers of Ex: Carnival Cruise Lines, Royal Caribbean Cruise
household products. Includes cleaning supplies, Lines, Crystal Cruises
2.1.3 Footwear - Manufacturers or designers disposable products, and paper towels, among
of footwear. Includes athletic shoes, boots, and others. 2.5.3 Hotels and Resorts - Owners and operators
sandals, among others. of hotels and resorts. Includes vacationing facilities
Ex: Clorox, Dixie, Kleenex and commercial establishments, among others.
Ex: Crocs, Sketchers, Timberland
2.3.4 Personal Products - Manufacturers of Ex: Four Seasons, Hyatt, Fairmont
2.1.4 Luxury Goods - Manufacturers or designers personal products. Includes cosmetics, perfumes,
of luxury goods. Includes high end clothing, and hygiene products, among others. 2.5.4 Leisure Facilities - Owners and operators of
accessories, and footwear, among others. leisure facilities. Includes fitness centers and day
Ex: Old Spice, Gillette, Dove spas, among others.
Ex: Gucci Group, Patek Philippe, Tag Heuer
International 2.3.5 Other Consumer Non-Durables Ex: LA Fitness, 24 Hour Fitness, Aveda Lifestyle
Salon and Spa
2.1.5 Other Apparel 2.4 Media
2.5.5 Restaurants and Bars - Owners and operators
2.2 Consumer Durables 2.4.1 Broadcasting, Radio and Television - of restaurants and bars.
Providers of entertainment through radio, television,
2.2.1 Business Equipment and Supplies - or the internet. Includes local, national, and Ex: Applebee’s, Chili’s, Ruth’s Chris Steak House
Manufacturers of office supplies and equipment. international radio and television channels.
Includes general office supplies, filing products, and 2.5.6 Other Restaurants, Hotels and Leisure
paper shredders, among others. Ex: NBC, Telemundo, YouTube
2.6 Retail
Ex: Pitney Bowes, Steelcase, 3M 2.4.2 Information Services - Providers of
information and content services. Includes political 2.6.1 Catalog Retail - Provider of retail services
2.2.2 Electronics - Manufacturers of consumer surveys, financial data, and statistics, among through mail order and TV home shopping.
electronics. Includes digital cameras, televisions, and others.
handheld devices, among others. Ex: QVC, HSN, Jewelry Television
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Data provided by
2.6.2 Department Stores - Owners and operators 2.8.1 Air - Providers of air transportation to testing and development of sites for well drilling and
of large stores with a wide variety of products in consumers. Includes major airlines and charter wind farms.
distinct departments. Includes apparel, furniture, airlines, among others.
electronics, hardware, and sporting goods, among Ex: Apache Corporation, Anadarko Petroleum, Hunt
others. Ex: Northwest Airlines, United Airlines, Alaska Oil
Airlines
Ex: Nordstrom, Macy’s, Neiman Marcus 3.2.2 Energy Production - Companies engaged in
2.8.2 Automotive - Providers of products energy production. Includes wind farming, drilling and
2.6.3 Distributors/Wholesale - Companies engaged and services related to automotives. Includes removal of crude oil and natural gas.
in the sale of bulk goods to individual consumers. automotive manufacturers and automotive
services, among others. Ex: Transocean, Diamond Offshore Drilling, Noble
Ex: Costco, Sam’s Club, BJ’s Wholesale Club Corporation
Ex: Ford, GM, Enterprise Rent-a-Car
2.6.4 General Merchandise Stores - Owners and 3.2.3 Energy Refining - Companies engaged in
operators of stores offering a wide variety of 2.8.3 Marine - Providers of products and services energy refining. Includes the refining of crude oil into
general merchandise. General merchandise includes related to water transportation. Includes leisure gasoline, diesel, kerosene, and fuel oil.
personal products, food, film, and prescriptions, boat manufacturers and yacht dealers, among
among others. others. Ex: Sasol, Valero Energy, Imperial Oil
Ex: CVS, RiteAid, Walgreen’s Ex: Viking Yacht Company, Marine Products 3.3 Services
Corporation, Fountain Powerboat Industries
2.6.5 Internet Retail - Providers of retail services 3.3.1 Energy Marketing - Companies engaged in
primarily through the internet. 2.8.4 Rail - Providers of products and services energy marketing. Includes gas marketing, pipeline
related to rail transportation. Includes passenger analysis, and asset management, among others.
Ex: Amazon.com, Overstock.com, Netflix trains and express trains, among others.
Ex: Marathon Oil, Hess Corporation, Murphy Oil
2.6.6 Specialty Retail - Owners and operators of Ex: Amtrak, Grand Luxe Rail Journeys, Union Pacific
retail stores specializing in the sale of goods in a Railroad 3.3.2 Energy Storage - Companies engaged in energy
particular industry or sector. storage. Includes commercial and industrial batteries,
2.8.5 Other Transportation fuel cells, and capacitors, among others.
Ex: Barnes and Noble, Petsmart, Office Depot
2.9 Other Consumer Products and Services Ex: ZBB Energy, Young Gas Storage, Falcon Gas
2.6.7 Other Retail Storage
2.9.1 Other Consumer Products and Services
2.7 Services (Non-Financial) 3.3.3 Energy Traders and Brokers - Companies
3 Energy engaged in energy trading and brokerage services.
2.7.1 Accounting, Audit and Tax Services - Providers
of accounting, audit, and tax services to individuals. 3.1 Equipment Ex: Dynergy, Reliant Energy, El Paso Corporation
Ex: HandR Block, Jackson Hewitt, Liberty Tax 3.1.1 Alternative Energy Equipment - 3.3.4 Energy Transportation - Companies engaged
Service Manufacturers or providers of alternative energy in energy transportation. Includes tankers, and
equipment. Includes compressed natural gas, solar, gathering and transmission pipelines, among others.
2.7.2 Educational and Training Services - hydroelectric, and wind, among others.
Providers of educational and professional training Ex: Energy Transfer Equity, Kinder Morgan Energy
services. Includes vocational education and exam Ex: The Wind Turbine Company, Vestas, Solar Partners, Enbridge
preparation, among others. Electric Power Company
3.3.5 Infrastructure - Companies engaged in energy
Ex: University of Phoenix, ITT Technical Institute, 3.1.2 Coal and Consumable Fuels Equipment - infrastructure. Includes pipelines, transmission lines,
Princeton Review Manufacturers or providers of coal and consumable generation plants, and refineries, among others.
fuels equipment.
2.7.3 Legal Services - Providers of legal services Ex: Energy Infrastructure Acquisition, Brookfield
to individuals. Includes criminal law, property Ex: Joy Mining Machinery, Getman, Peters Infrastructure Partners, Tortoise Energy Infrastructure
law, human rights law, and insurance law, among Equipment Company
others. 3.3.6 Other Energy Services
3.1.3 Oil and Gas Equipment - Manufacturers or
Ex: DLA Piper, Goodwin Procter, White and Case providers of oil and gas equipment. Includes rigs 3.4 Utilities
and drilling equipment, among others.
2.7.4 Real Estate Services - Providers of real estate 3.4.1 Electric Utilities - Companies engaged in the
services to individuals. Includes real estate brokers Ex: Weatherford International, Baker Hughes, generation, transmission, and distribution of energy
and property valuation, among others. Cameron International for sale in the regulated market.
Ex: Century 21, RE/MAX, Coldwell Banker 3.1.4 Other Equipment Ex: Southern Company, FPL Group, Dominion
Resources
2.7.5 Other Services (Non-Financial) 3.2 Exploration, Production and Refining
3.4.2 Gas Utilities - Companies engaged in the
2.8 Transportation 3.2.1 Energy Exploration - Companies engaged production, distribution and marketing of natural gas
in energy exploration. Includes the identification, and related services.
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Ex: National Grid, Sempra Energy, Equitable Ex: Deutsche Bank, UBS, Bank of America 4.4 Other Financial Services
Resources
4.2.2 National Banks - Non-investment commercial 4.4.1 Consumer Finance - Companies engaged
3.4.3 Multi-Utilities - Companies engaged in the banks located in one country. in any kind of lending to consumers. Includes sub
generation, transmission, distribution, and sale of prime lending, among others.
water, electricity and natural gas to residential, Ex: Bank of New York, Citizens Bank, Capital One
commercial, industrial, and wholesale customers. Bank Ex: HSBC Finance, CIT, CitiFinancial
Ex: Exelon Corporation, Public Service Enterprise 4.2.3 Regional Banks - Non-investment commercial 4.4.2 Holding Companies - Companies that do not
Group, PGandE banks located in a particular region. produce goods or provide services, but instead own
shares of other companies.
3.4.4 Water Utilities - Companies engaged in Ex: Sterling Savings Bank, Evergreen Bank,
providing water or wastewater services. HomeStreet Bank Ex: Berkshire Hathaway, UAL Corporation, AMR
Corporation
Ex: Aqua America, California Water Service Group, 4.2.4 Thrifts and Mortgage Finance - Financial
American States Water Company institutions specializing in originating and/or 4.4.3 Real Estate Investment Trusts (REITs) - REIT
servicing mortgage loans. is a tax designation for a corporation investing in
3.4.5 Other Utilities real estate. REITs receive special tax reductions and
Ex: Accredited Home Lenders, Countrywide, offer high yield investments in real estate.
3.5 Other Energy Quicken Loans
Ex: AMB Property, Duke Realty, EastGroup
3.5.1 Other Energy 4.2.5 Other Commercial Banks Properties
4 Financial Services 4.3 Insurance 4.4.4 Specialized Finance - Companies engaged

in providing specialized finance to both public and
4.1 Capital Markets/Institutions 4.3.1 Automotive Insurance - Providers of insurance private enterprises.
for cars, trucks, and other vehicles.
4.1.1 Asset Management - Financial institutions Ex: Latitude Capital Group, Budget Finance
providing management of various securities to Ex: State Farm, All-State, GEICO Company, Capital Source
meet specified investment goals for the investors.
Investors may be institutions or high net worth 4.3.2 Commercial/Professional Insurance - Providers 4.4.5 Other Financial Services
individuals. of commercial or professional insurance. Includes
medical malpractice and legal malpractice, among 5 Healthcare
Ex: Smith Barney, Edward Jones, Ameriprise others.
Financial 5.1 Devices and Supplies
Ex: CNA Insurance, Zurich, FM Global
4.1.2 Brokerage - Financial Institutions acting as 5.1.1 Diagnostic Equipment - Manufacturers of
an intermediary between a buyer and seller of 4.3.3 Insurance Brokers - Companies sourcing imaging and non-imaging devices used to assess
securities, usually charging a commission. Includes contracts of insurance on behalf of their customers. and diagnose medical conditions. Includes X-ray
clearing houses and stock brokerage firms, among and MRI machines, otoscopes and stethoscopes,
others. Ex: Marsh and McLennan, Willis Group, Brown and and ultrasound equipment, among others.
Brown
Ex: Citigroup, Options Clearing Corporation, LCH. Ex: Welch Allyn, Siemens, AFC Industries, SOMA
Clearnet 4.3.4 Life and Health Insurance - Providers of life Technology
and health insurance.
4.1.3 Investment Banks - Financial institutions 5.1.2 Medical Supplies - Manufacturers of medical
functioning across all areas of capital markets. Ex: ING, Prudential, MetLife supplies that would be considered non-durable.
Includes raising money by issuing and selling Includes syringes, diabetes supplies, bandages, and
securities, and advisory within mergers and 4.3.5 Multi-line Insurance - Providers of diversified protective wear, among others.
acquisitions, among other financial services. insurance services with multiple interests in life,
health, and property insurance. Ex: Frank Healthcare, Johnson and Johnson,
Ex: Citigroup, Goldman Sachs, Lehman Brothers Adenna, Cardinal Health, Covidien
Ex: AXA, Prudential, Sun Life
4.1.4 Private Equity - Financial institutions engaged 5.1.3 Monitoring Equipment - Manufacturers of
in long-term loans with multinational corporations 4.3.6 Property and Casualty Insurance - Providers devices used to collect and monitor vital signs.
and governments. Includes merchant banks, and of property and casualty risks insurance. Includes heart-rate monitors, oxygen saturation
private equity firms, among others. monitors, and fetal monitors, among others.
Ex: Allianz, American International Group, Hartford
Ex: Blackstone Group, Carlyle Group, Kohlberg Financial Ex: Phillips Medical Systems, GE Medical Systems,
Kravis Roberts Welch Allyn, SOMA Technology, Datascope
4.3.7 Re-Insurance - Providers of insurance to
4.1.5 Other Capital Markets/Institutions insurance companies. 5.1.4 Surgical Devices - Manufacturers of devices
and equipment used in a surgical setting. Includes
4.2 Commercial Banks Ex: Berkshire Hathaway, Munich Reinsurance, laparoscopy instruments, retractor systems, and
Hannover Reinsurance positioning devices, among others.
4.2.1 International Banks - Non-investment
commercial banks located in more than one country. 4.3.8 Other insurance Ex: Lyons, Mediflex, Boston Scientific
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Data provided by
5.1.5 Therapeutic Devices - Manufacturers of 5.3.1 Decision/Risk Analysis - Developers and Ex: Bristol-Meyers Squibb, GlaxoSmithKline,
devices for rehabilitation or therapy. Includes producers of software or systems used to expedite Novartis, Eli Lilly and Company
muscle stimulators, light therapy, and pacemakers, the medical decision and risk management process.
among others. These programs try to assist doctors and nurses in 5.4.6 Other Pharmaceuticals and Biotechnology
their decision making process.
Ex: Medtronic, Boston Scientific, Empi 5.5 Other Healthcare
Ex: HLTH Corporation, Apache Medical Systems,
5.1.6 Other Devices and Supplies Wellsource 5.5.1 Other Healthcare
5.2 Services 5.3.2 Enterprise Systems - Developers and 6 Information Technology

producers of software and systems that cover
5.2.1 Clinics/Outpatient Services - Facilities and multiple areas of the healthcare organization. 6.1 Communications and Networking
services for short-term, outpatient care and
procedures. Includes rehabilitation, diagnostic Ex: NextGen, Cerner, McKesson Corporation 6.1.1 Cable Service Providers - Developers and
testing, and outpatient surgery and exams. marketers of television, internet and voice services
5.3.3 Medical Records Systems - Developers and for cable networks. Includes broadband internet,
Ex: AmSurg, Physiotherapy Associates, producers of software or systems to organize VoIP, and cable television, among others.
HealthSouth medical records.
Ex: Comcast, Cox Communications, Adelphia
5.2.2 Distributors - Distributors of healthcare Ex: NextGen, McKesson, MediNotes
equipment and supplies. Includes all distributors of 6.1.2 Connectivity Products - Manufacturers of
healthcare products. 5.3.4 Outcome Management - Developers and electronic components used to create networks or
producers of software or systems used to analyze link devices. Includes bulk cable, connectors, and
Ex: American Medical Supplies and Equipment, the effectiveness of treatments prescribed by adapters, among others.
AmerisourceBergen, BMP Sunstone, Owens and doctors.
Minor Ex: Belkin, AMP Inc., Griffin Technology, Molex
Ex: Tri-Analytics, Outcome Concept Systems,
5.2.3 Elder and Disabled Care - Facilities and Protocol Driven Healthcare 6.1.3 Fiberoptic Equipment - Manufacturers of fiber
services for the care of senior citizens. Includes optic and photonics equipment. Includes bulk cable,
assisted living, long term care, hospice care, nursing 5.3.5 Other Healthcare Technology Systems connectors, lasers, and light emitting diodes (LEDs),
homes, and home care, among others. among others.
5.4 Pharmaceuticals and Biotechnology
Ex: RehabCare Group, Sunrise Senior Living, Ex: Oplink Communications, Optical Communication
AccentCare 5.4.1 Biotechnology - Companies engaged Products, Belden
in research, development, and production of
5.2.4 Hospitals/Inpatient Services - Facilities and biotechnology. Includes embryology, genetics, 6.1.4 Internet Service Providers - Providers of dial-
services for long-term care, and inpatient care and cell biology, molecular biology, and biochemistry, up and DSL access to the internet.
procedures. Includes invasive surgical procedures, among others.
and emergency services. Ex: America Online, NetZero, EarthLink, Juno,
Ex: Elan, Genentech, Amgen PeoplePC
Ex: Tenet Healthcare, HCA, Universal Health
Services 5.4.2 Discovery Tools - Researchers and developers 6.1.5 Telecommunications Service Providers -
of tools used in drug discovery and drug delivery Providers of commercial and residential voice and
5.2.5 Laboratory Services - Providers of medical research. Includes compound libraries, enzymes, data services. Includes phone service, paging, and
laboratory services. Includes blood and tissue kinases, and specialized proteins, among others. voicemail, among others.
testing.
Ex: PerkinElmer, Qiagen, Charles River Laboratories Ex: BellSouth, AT&T, Qwest, Vodafone, Airtel
Ex: Quest Diagnostics, LabCorp, LabOne
5.4.3 Drug Delivery - Researchers and developers 6.1.6 Wireless Communications Equipment -
5.2.6 Managed Care - Owners and operators of of medication delivery methods. Includes targeted Manufacturers, designers and marketers of wireless
managed health plans. Includes Preferred Provider delivery methods, and timed release formulations, communications equipment. Includes wireless
Organizations (PPOs) and Health Maintenance among others. handsets, and wireless modems and routers,
Organizations (HMOs). among others.
Ex: Elan, Hospira, Nektar Therapeutics
Ex: Aetna, Kaiser Permanente, UnitedHealth Group Ex: LG, Motorola, Cisco
5.4.4 Drug Discovery - Researchers and developers
5.2.7 Practice Management - Providers of of new drugs. Includes identification, screening, and 6.1.7 Wireless Service Providers - Providers of
consulting and management services to medical efficacy testing of drug candidates, among others. wireless telephone networks. Includes cellular
practices. Excludes practice management software, telephone service, and personal communication
such as billing or medical records software. Ex: Bristol-Meyers Squibb, PerkinElmer, Elan service (PCS), among others.
Ex: Advantage Medical Claims, Medical 5.4.5 Pharmaceuticals - Manufacturers and Ex: Verizon Wireless, Qualcomm, Nextel Partners
Management Associates, Healthcare Facilitators distributors of established drugs/pharmaceuticals.
This category includes any large drug company 6.1.8 Other Communications and Networking
5.2.8 Other Healthcare Services that primarily manufactures medicines; however
they may also be engaged in drug research and 6.2 Hardware
5.3 Healthcare Technology Systems development.
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6.2.1 Computers, Parts and Peripherals - 6.4.1 Consulting and Outsourcing - Providers of 6.5.8 Financial Software - Developers and
Manufacturers, designers, and distributors of outside consulting, outsourcing, or offshoring producers of software for managing accounting and
computers and peripherals. Includes monitors, cases, services. Includes subcontractors, and business financial processes. Also includes various software
mice, keyboards, and printers, among others. process outsourcers, among others. developed specifically for the financial industry.
Ex: Dell, Apple, Hewlett-Packard, Sony, IBM Ex: Gartner, Infosys Technologies, Sapient Ex: Intuit, CapControls, Merlin Securities, Tally,
Corporation Finacle
6.2.2 Electronic Components - Manufacturers,
designers, and distributors of electronic parts and 6.4.2 Systems and Information - Management 6.5.9 Internet Software - Developers and producers
components for use in more advanced products. Providers of systems and information management of software for accessing and manipulating internet
Includes processors, video cards, sound cards, fans, services. Includes companies providing IT hosting content. Includes internet browsers, and file transfer
and motherboards, among others. and data centers, among others. protocol (FTP) programs, among others.
Ex: Intel, Advanced Micro Devices (AMD), Texas Ex: Rackspace, Network World, Mosso Ex: Apple, Microsoft, Mozilla Foundation,
Instruments, NVIDIA Norwegian Opera Software
6.4.3 Other IT Services
6.2.3 Electronic Equipment and Instruments - 6.5.10 Multimedia and Design Software -
Manufacturers, designers, and distributors of 6.5 Software Developers and producers of software for creating
electronic equipment and instruments. Includes and manipulating multimedia content. Includes
multimeters, and oscilloscopes, among others. This 6.5.1 Application Software - Developers and Computer Aided Design (CAD) software, and video
category is for electronic testing and measurement producers of software for specific tasks or and image editing software, among others.
devices. applications. Includes general application software
not classified elsewhere. Ex: Adobe Systems, Quark, Autodesk
Ex: Agilent Technologies, National Instruments,
Tektronix, Chase Scientific Ex: Microsoft, Oracle, Adobe 6.5.11 Network Management Software -
Developers and providers of software and systems
6.2.4 Office Electronics - Manufacturers, designers, 6.5.2 Automation/Workflow Software - Developers for managing and organizing networks and
and distributors of office equipment. Includes copiers and producers of software for automation and information. Includes network monitoring software,
and faxes, among others. workflow management. Includes automation of IT and network security software, among others.
processes, data transferring, FTPs, and scheduling,
Ex: Xerox, Ricoh, Lanier among others. Ex: Altiris, Tivoli, NetIQ
6.2.5 Storage - Manufacturers, designers, and Ex: Tethys Solutions, Parallels, Synopsys 6.5.12 Operating Systems Software - Developers
distributors of electronic storage devices. Includes and producers of computer operating systems.
hard drives, optical drives, and flash memory, among 6.5.3 Business/Productivity Software - Developers
others. and producers of software for the enterprise where Ex: Apple, Microsoft, Red Hat Software, Novell
the focus is on process management and automation.
Ex: Seagate Technology, EMC, Western Digital 6.5.13 Social/Platform Software - Developers
Ex: Salesforce, IBM, Microsoft and producers of software that facilitates the
6.2.6 Other Hardware production, distribution or following of social
6.5.4 Communication Software - Developers content. The category also includes online markets.
6.3 Semiconductors and producers of software for communicating
electronically through voice, video or text. Includes Ex: Facebook, LinkedIn
6.3.1 Application Specific - Manufacturers and text and video chat, web conferencing, and web-
designers of application specific semiconductors and based presentations, among others. 6.5.14 Software Development Applications -
integrated circuits. Developers and producers of software for planning,
Ex: America Online, Microsoft, WebEx coding, and debugging of new software. Includes
Ex: First Solar, NVIDIA, Linear Technology compilers, build tools, debuggers, disassemblers,
6.5.5 Database Software - Developers and and documentation generators, among others.
6.3.2 General Purpose - Manufacturers and producers of software to manage and utilize
designers of generic or general purpose information in databases. Includes MySQL, Microsoft Ex: Eiffel Software, Borland Software, BigFix
semiconductors and integrated circuits. SQL Server, and Oracle, among others.
6.5.15 Vertical Market Software - Developers and
Ex: Intel, Texas Instruments, STMicroelectronics Ex: Microsoft, Oracle, IBM, Sun Microsystems producers of vertical market software. Includes
point of sale software, among others. A vertical
6.3.3 Production - Owners and operators of 6.5.6 Educational Software - Developers and market is a group of companies that do business in
semiconductor foundries. “Foundries” are companies producers of educational software. the same industry.
that manufacture semiconductors, but are not
involved in their design. Ex: Renaissance Learning, Scientific Learning Ex: SAP, Hypercom, Ingenico
Corporation, The Learning Company
Ex: Taiwan Semiconductor Manufacturing, United 6.5.16 Other Software
Microelectronics, Chartered Semiconductor 6.5.7 Entertainment Software - Developers
Manufacturing, SMIC of consumer-oriented gaming software and 6.6 Other Information Technology
applications.
6.3.4 Other Semiconductors 6.6.1 Other Information Technology
Ex: Zynga, Rovio
6.4 Services 7 Materials & Resources
75
Data provided by
7.1 Agriculture among others. Finished construction products are Ex: Peabody Energy, CONSOL Energy, Drummond
classified under Building Products. Company
7.1.1 Animal Husbandry - Companies that breed,
raise, and market livestock. Ex: Texas Industries, Eagle Materials, Hanson 7.6.3 Gold - Miners, producers and marketers of
Aggregates North America gold.
Ex: Seaboard Corp., Smithfield Foods, Alico
7.4 Containers and Packaging Ex: Newmont Mining, AngloGold Ashanti, Gold
7.1.2 Aquaculture - Companies that cultivate and Fields Limited
market aquatic organisms. Includes fish, shrimp, 7.4.1 Metal - Producers of metal containers and
kelp/seaweed and cultured pearls, among others. packaging materials. 7.6.4 Iron and Steel - Miners, producers and
marketers of iron and steel.
Ex: Stolt Sea Farm, D.B. Kenney Fisheries, America’s Ex: Ball Corporation, Greif Inc., Silgan Holdings
Catch Ex: Nucor, Olympic Steel, ArcelorMittal
7.4.2 Paper - Producers of paper containers and
7.1.3 Cultivation packaging materials. 7.6.5 Multi-line - Miners, producers and marketers
of diversified metals and minerals.
7.1.4 Horticulture - Companies that cultivate and Ex: Packaging Corporation of America, International
market grains, fruits, flowers, and vegetables. Paper, Georgia-Pacific Ex: BHP Billiton, Rio Tinto, Teck Cominco
Ex: Cargill, Archer Daniels Midland, The Andersons, 7.4.3 Plastic - Producers of plastic containers and 7.6.6 Precious Metals and Minerals - Miners,
Inc. packaging materials. producers and marketers of precious metals and
minerals. Includes platinum, silver, and palladium,
7.1.5 Other Agriculture Ex: Ball Corporation, Sonoco, Silgan Holdings among others.
7.2 Chemicals and Gases 7.4.4 Wood - Producers of wood containers and Ex: Coeur d’Alene Mines, Stillwater Mining, Metalor
packaging materials.
7.2.1 Agricultural Chemicals - Producers of 7.6.7 Other Metals, Minerals and Mining
chemicals used primarily in an agricultural setting. Ex: Greif Inc., Berry Industrial Group, Universal
Includes diammonium phosphate (DAP), anhydrous Forest Products 7.7 Textiles
ammonia (NH3), and potassium chloride (KCl),
among others. 7.4.5 Other Containers and Packaging 7.7.1 Animal - Manufacturers of animal-based
textiles. Includes wool, cashmere and silk, among
Ex: Monsanto, Mosaic, CF Industries Holdings 7.5 Forestry others.
7.2.2 Commodity Chemicals - Producers of 7.5.1 Forestry Development/Harvesting - Ex: Buckskin Fur and Leather, J. Hewit and Sons
chemicals that are sold in bulk due to their low cost. Companies engaged in developing and harvesting
Includes methane, hydrochloric acid, chlorine, and forested areas. 7.7.2 Plant- Manufacturers of plant-based textiles.
sodium chloride, among others. Includes hemp and cotton, among others.
Ex: Weyerhaeuser, Deltic Timber, MAXXAM
Ex: Mitsubishi Chemical, Terra Nitrogen, ExxonMobil Ex: Parkdale Mills, Boston Felt Company, Aetna Felt
7.5.2 Forestry Processing - Companies engaged Corporation
7.2.3 Industrial Chemicals - Producers of chemicals in converting raw forest products into marketable
used primarily in industrial applications. Includes materials. Includes lumber, woodchips, engineered 7.7.3 Mineral - Manufacturers of mineral-based
plastics, biocides, coolants, and polyglycols, among wood products, and paper products, among others. textiles. Includes asbestos, glass fiber, and metal
others. fiber, among others.
Ex: Weyerhaeuser, Louisiana-Pacific, Stimson
Ex: Celanese, FMC Corp., Archer Daniels Midland Lumber, Pope and Talbot, Georgia-Pacific, Boise Ex: Roxul, Potter and Soar, Central Glass
Cascade, Temple-Inland Forest Products
7.2.4 Multi-line Chemicals - Producers of diversified 7.7.4 Synthetic - Manufacturers of synthetic textiles.
chemicals. 7.5.3 Paper/Soft Products Includes polyester, aramid, nylon and spandex,
among others.
Ex: Dow Chemical, Air Products and Chemicals, 7.5.4 Wood/Hard Products
FMC Corp., DuPont Ex: Huitong Chemical, Unifi, DuPont-Akra Polyester
7.5.5 Other Forestry
7.2.5 Specialty Chemicals - Producers of proprietary 7.7.5 Other Textiles
or advanced chemical compounds. Includes food 7.6 Metals, Minerals and Mining
additives, and polymers, among others. 7.8 Other Materials
7.6.1 Aluminum - Miners, producers and marketers
Ex: Sigma-Aldrich, Lubrizol, Cytec Industries of aluminum. Includes aluminum ore, and rolled 7.8.1 Other Materials
aluminum, among others.
7.2.6 Other Chemicals and Gases
Ex: Alcoa, Kaiser Aluminum, Alcan
7.3 Construction (Non-Wood)
7.6.2 Coal - Miners, producers and marketers
7.3.1 Raw Materials (Non-Wood) - Harvesters or of coal. Includes lignite coal, bituminous coal,
producers of non-wood construction materials. anthracite coal, and coke, among others.
Includes stone, gravel, sand, cement, and bricks,
76
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Y E ARBOOK

Venture Forward CHARLES HUDSON Precursor Ventures, Chair Elect

Washington, DC | San Francisco, CA VINEETA AGARWALA Andreessen Horowitz

ventureforward.org BYRON DEETER Bessemer Venture Partners

JOHN GABBERT Founder, CEO NNAMDI OKIKE 645 Ventures

ALE X WARFEL Quantitative Research Analyst

Note from NVCA

FISCAL POLICY: FEDERAL GOVERNMENT ACTION

Venture Capital 101

A Brief History of contraction of the VC industry. Facebook years is increasingly common.

1. Cannot be financed with traditional

2. Threaten established products and

Modern VC came into existence in

might be engaged. According to a 2016

As a company grows, it might require

Energy 2% Source: NVCA 2023 Yearbook, Data provided by PitchBook

Source: NVCA 2023 Yearbook; Data provided by PitchBook

Advice VCs Give US VC Exit Activity

FUND STRUCTURE Typical Distribution of

There is a stark contrast between the level

Carolina at Chapel Hill recently released a

backed. These 834 companies represent

public markets, 92% of national research

and Trademark Office. 9

Active Investor Count in 2022 Deals by Company HQ State

By the end of 2022, VC-backed companies

Software Company Consumer G&S Commercial P&S

Healthcare-related investment was the

2021 was a record year for American $350 18,000

venture capital. While the possible 16,000

pace, with steady but cautious venture $50 2,000

Market Shifts Source: NVCA 2023 Yearbook; Data provided by PitchBook

Under ideal market conditions, investors

The world reopened after the first

While Q1 2022 mirrored the heights of

Capital Raised ($B) Fund Count

2022 saw $163 billion raised among 784

Source: NVCA 2023 Yearbook; Data provided by PitchBook

Competition NTI and CVC Investor Count

Source: NVCA 2023 Yearbook; Data provided by PitchBook

10 Largest US VC Funds in 2022

Andreessen Horowitz a16z crypto IV $4,500.0 May 25, 2022 California

Accel Accel Leaders IV $4,000.0 June 21, 2022 California

Founders Fund Founders Fund Growth II $3,431.1 March 4, 2022 California

Source: NVCA 2023 Yearbook; Data provided by PitchBook

Top States by VC Raised in 2022

California 306 $78,275.4 3.5%

New York 153 $45,349.8 42.1%

Massachusetts 62 $15,649.5 -0.5%

Illinois 25 $4,150.7 -33.1%

Florida 23 $2,613.4 139.7%

Texas 36 $2,419.5 -46.3%

Connecticut 10 $2,126.1 0.8%

Washington 11 $2,078.0 -8.9%

District of Columbia 8 $2,018.0 539.5%

Georgia 7 $1,180.5 -6.4%

Source: NVCA 2023 Yearbook; Data provided by PitchBook

VC Fundraising by State and Year ($M)

Alabama $36.6 - $21.9 - $25.6 - - - $5.0 -

Arizona - - - - $20.0 - - $300.0 $53.7 $104.5

Delaware - - $13.0 - - $100.0 $15.0 - $4.9 -

District of Columbia $400.1 - - $828.2 $380.0 - - $475.0 $68.4 $400.0

Hawaii $7.9 $6.5 - - $1.8 - - - - -